Friday, January 12, 2001
home page local news opinion business island life sports
AP MoneyWire
Island Bank Rates
Small Business
AP Technology News
AP Stock Quotes
Search by ticker symbol, abbreviation from The Advertiser or company name

Classified Ads
Restaurant Guide
Business Directory

Posted on: Friday, January 12, 2001

Matson Navigation Co. fined $3 million

By Sally Apgar
Advertiser Staff Writer

The president of Matson Navigation Co. yesterday apologized for "the actions of a few employees" aboard a Matson ship who falsified federal pollution control records.

After a 21-month investigation by U.S. attorneys in Los Angeles, Oakland, Calif., and Seattle, Matson yesterday agreed to plead guilty and pay a $3 million fine to the federal government.

In court records filed yesterday, prosecutors cited six separate instances in which records were falsified to say that an oil-water separator had been used to process bilge before it was discharged from the Lihue, a 38,000-ton container ship. The separator had not been used or was not even functioning at the time of the incidents.

From 1996 to 1998, three incidents occurred in waters off Los Angeles, one off Oakland and one off Seattle. In pleading guilty, Matson waived indictments from grand juries in California and Washington state.

As part of the settlement, prosecutors in Hawaii and Guam agreed not to seek charges against Matson for violations that may have occurred in those areas.

Of the $3 million fine, about half will be applied to environmental projects based in California and Washington state. Matson also is on three years of probation, during which it is expected to comply with federal, state and local environmental laws. Matson said that before the incidents, it had environmental compliance plans in place, but has since modified these policies to prevent such occurrences in the future.

Matson President C. Bradley Mulholland said the three U.S. attorney’s offices had made a "thorough investigation" and found "we do not have a systemic problem in the company. This is a one-ship issue, in the engine room of one ship at sea. And that’s where this is confined to."

Mulholland also stressed that the two or three engine room crew members involved in the incidents "are our employees and we are responsible for their actions." He also said the crew members have not worked on Matson ships since 1999.

Mulholland said the government found "no evidence of any pollution, and that no oil or contaminated oil was discharged into the ocean."

"We did not pollute the ocean and that has been backed up by the opinion of the government," Mulholland said. "What we have here is a document issue where a handful of individuals on one ship, for reasons we don’t know, made a false entry."

Mulholland also said Matson has "fully cooperated" with the U.S. attorneys since company officials were first approached in April 1999. He said the government subpoenaed five years of records for each of Matson’s 15 ships. Matson turned over about 70,000 to 80,000 documents, he said.

The Coast Guard, believed to have been working from a tip, began the investigation by studying oil record books from Matson ships. The books, which are compiled by crews but are government records, typically are kept in the engine rooms of every ship to log transfers of oil, the disposal of sludge and bilge water, and overboard discharges of bilge water.

During the investigation, it was found that the oil-water separator had not been working when documents had stated the equipment had been used to process the bilge liquid. Prosecutors said that had the Coast Guard known of such mechanical problems, it would have prevented Matson from operating the ship.

"You cannot lie to federal regulators in an effort to prevent them from determining whether you have polluted our waters," said Alejandro Mayorkas, the U.S. attorney in Los Angeles. "We are committed to protecting the environment against such criminal conduct."

The Associated Press contributed to this report.

[back to top]

Home | Local News | Opinion | Business | Island Life | Sports
USA Today Stocks | Island Stocks | Island Mutuals | Island Bank Rates
Small Business Resources | Investment Glossary
How to Subscribe | How to Advertise | Site Map | Terms of Service | Corrections

© COPYRIGHT 2001 The Honolulu Advertiser, a division of Gannett Co. Inc.