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Carnival fined after admitting dumping garbage in the ocean, again

Diamond Princess Cruise Ship

Princess Cruise Lines and its parent, Carnival Cruise Lines, were ordered to pay a $20 million criminal penalty Monday and will be under more supervision after admitting to violations of its probation related to dumping waste into the ocean.

Princess was convicted and sentenced in April 2017, after pleading guilty to felony charges after dumping oil-contaminated waste from one of its ships in the ocean and then covering it up. While serving five years of probation, all Carnival ships using U.S. ports were required to comply with an environmental compliance plan, including audits by an independent company and oversight by a court monitor. Many violations have been identified by the company, the outside auditor, and the court’s monitor during the first two years of probation, the U.S. Justice Department said.

Carnival admitted it was guilty of committing six violations of its probation. Two of the violations involved sending teams to ships to prepare them for inspections during probation. When the court found out about this in December 2017, a federal district court judge ordered that the practice be stopped and additional inspections were ordered. However, a second program was started shortly after that. The purpose of the programs was to avoid adverse findings during the inspections.

“Carnival sought to avoid the discovery of problems during the audits rather than learn from them,” said Assistant Attorney General Jeffrey Bossert Clark for the Justice Department’s Environment and Natural Resources Division. “Carnival’s deliberate deception undermined the court’s supervision of probation.”

Carnival’s chairman of the board, CEO, and CFO attended a court-ordered hearing and were asked to pledge their commitment to correcting the company’s compliance issues and corporate culture. In addition, senior management of each operating cruise line of Carnival Corp. was present for the court proceedings.

The company admitted to other violations of probation including:

  • Failing to establish a senior corporate officer as a corporate compliance manager with responsibility for carrying out new environmental measures required during probation.
  • Contacting the Coast Guard seeking to re-define the definition of what constitutes a major non-conformity under the ECP without going through the required process and after the government had rejected the proposal and told the company to file a motion with the court if it wanted to pursue the issue.
  • Deliberately falsifying environmental training records aboard two cruise ships.
  • Deliberately discharging plastic in Bahamian waters from the Carnival Elation and failing to accurately record the illegal discharges. Prosecutors told the court that this discharge was an example of a widespread problem, identified by the external audits, in failing to segregate plastic and non-food garbage from waste thrown overboard from numerous cruise ships.

Under the terms of the settlement, Carnival will:

  • Pay a $20 million criminal penalty.
  • Issue a statement to all employees in which Carnival’s CEO accepts management’s responsibility for the probation violations.
  • Restructure the company’s corporate compliance efforts.
  • Pay up to $10 million per day if it doesn’t meet deadlines for carrying out needed changes to its corporate structure.
  • Pay for 15 additional audits per year conducted by the third-party auditor and court-appointed monitor in addition to about 31 ship audits and six shore-side audits currently performed annually.
  • Comply with new reporting requirements, including notifying the government and court of all future violations, and specifically identifying foreign violations and the country impacted.
  • Make major changes in how the company uses and disposes of plastic and other non-food waste to urgently address a problem on many ships concerning illegal discharges of plastic mixed with other garbage.

The revised sentence imposed by the judge also requires that Princess remain on probation for three years.

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