Texas Grand Jury Indicts Fleet Management Limited for Pollution

A federal grand jury in Corpus Christi, Texas has returned an indictment charging Fleet Management Limited with obstruction of agency proceedings, making false statements and failing to keep accurate pollution control records.

Fleet Management Limited of Hong Kong is charged with failing to maintain an accurate oil record book as required by the Act to Prevent Pollution from Ships (APPS), a U.S. law which implements the International Convention for the Prevention of Pollution from Ships, commonly known as “MARPOL;” making false statements to the U.S. Coast Guard; and obstruction. If convicted of all counts, the company may be punished with a fine of up to $3 million.

Two individuals, Prem Kumar, a ship superintendent for Fleet Management Limited and Prasada Reddy Mareddy, the second engineer of the M/V Lowlands Sumida, have both been individually charged with conspiracy. Kumar was also charged with obstruction of a Coast Guard investigation. If convicted of the conspiracy charge, both face up to five years in prison and a fine of $250,000. If convicted of obstruction of justice, Kumar faces up to 20 years in prison and a $250,000 fine.

On Oct. 6, 2009, the Coast Guard was conducting a routine port state control inspection in Corpus Christi, Texas when an engine room crew member said the vessel was illegally discharging oily wastewater and that a center fuel oil tank on the Lowlands Sumida was fitted with a “dummy” or false sounding tube and that oily waste water was being stored in the tank until it could be discharged overboard.

Large commercial ships, such as the Lowlands Sumida, are required by MARPOL and APPS to maintain a record known as the oil record book to document all oil that has originated in the engineering spaces on the ship.

On April 21, 2010, John Porunnolil Zacharias, the chief engineer of the Lowlands Sumida, pleaded guilty to failing to maintain an oil record book and to obstruction for providing inspectors with a false engine room sounding log, and for altering a center fuel oil tank by installing a “dummy” sounding tube to conceal the contents of the tank. Zacharias is scheduled to be sentenced on July 7, 2010.

The case was investigated by the Coast Guard Investigative Service, the Environmental Protection Agency Criminal Investigations Division in Region VI and the Texas Commission on Environmental Quality Environmental Crimes Unit. The case is being prosecuted by the Justice Department’s Environmental Crimes Section and the U.S. Attorney’s Office for the Southern District of Texas.