Princess Cruise Lines Ltd. (Princess) and its parent, Carnival Cruise Lines & plc (together called Carnival) on Monday (3 June) were ordered to pay a $20 million criminal penalty and will be subject to enhanced supervision after admitting to violations of probation attributable to senior Carnival management in a case in which Princess had already paid $40 million.
Princess was convicted and sentenced in April 2017, after pleading guilty to felony charges stemming from its deliberate dumping of oil-contaminated waste from one of its vessels and intentional acts to cover it up.
While serving 5 years of probation, all Carnival related cruise lines vessels eligible to trade in U.S. ports were required to comply with a court approved and supervised environmental compliance plan (ECP), including audits by an independent company and oversight by a Court Appointed Monitor.
Numerous violations have been identified by the company, the outside auditor, and the court’s monitor during the first two years of probation, including “major non-conformities” as defined by the ECP.
Carnival admitted it was guilty of committing six violations of probation. Two of the violations involved interfering with the court’s supervision of probation by sending undisclosed teams to ships to prepare them for the independent inspections required during probation.
When this was first discovered in December 2017, U.S. District Court Judge Patricia Seitz directed that the practice cease and ordered additional inspections as a consequence. However, without seeking court approval, a second undisclosed program was started shortly thereafter. Documents filed in court showed that a purpose of the vessel visit programs was to avoid adverse findings during the inspections.
“This case demonstrates the importance of identifying and correcting compliance problems at their source,” said Assistant Attorney General Jeffrey Bossert Clark for the Justice Department’s Environment and Natural Resources Division.
“Carnival sought to avoid the discovery of problems during the audits rather than learn from them.
“Carnival’s deliberate deception undermined the court’s supervision of probation.”
Carnival’s Chairman of the Board, Chief Executive Officer and Chief Financial Officer attended the hearing pursuant to court’s order and were asked to personally pledge their commitment to correcting the company’s compliance issues and corporate culture.
In addition, senior management of each operating cruise line of Carnival Corporation & plc were present for the court proceedings.
“A corporation is responsible to its shareholders and board of directors to be profitable, but not by breaking the law and destroying the very environment in which it navigates for profit,” said U.S. Attorney Ariana Fajardo Orshan for the Southern District of Florida.
“Carnival’s failure to comply with the terms of its probation and later, its attempt to drown its deceit goes against the fiber of corporate compliance. The Office of Probation and the Court Appointed Monitor are to be commended for their attention to this matter.”
Among Carnival’s violations of probation were for:
Published: 6 June, 2019
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