Source: https://www.itic-insure.com/our-publications/intermediary/marpol-magic-pipes-and-whistleblowers-the-dos-and-donts-for-effective-environmental-compliance-2766/
Timestamp: 2019-04-22 05:58:06+00:00

Document:
MARPOL, Magic Pipes and Whistleblowers - The Do’s and Don’ts for Effective Environmental Compliance.
Since the tragic events of September 11th, the United States Coast Guard has undertaken a comprehensive program of boarding vessels calling U.S. ports. As a result of the heightened security measures, there has been a significant increase in the scrutiny to which a vessel, her logs, and her records, are being inspected. Such scrutiny, rightly or wrongly, continues to result in numerous vessel and crew detentions, as well as massive civil and criminal charges against vessel Owners, Operators, Managers, Officers and crew.
Specifically, the U.S. Coast Guard established an Oily Water Separator Task Force to examine a wide range of issues related to pollution control equipment and its use on vessels in U.S. waters. The Coast Guard and other law enforcement personnel regularly examine the use and functionality of oily water separator systems more carefully than ever before, and have made it clear that they will seek jail sentences for Masters and engineers of ships committing pollution offense, or falsifying records, including but not limited to Oil Record Books (hereinafter “ORB”). The fact that an Owner, Operator and/or their shore-side staff may be located outside the U.S. is no deterrent to dogged prosecution efforts. Quite often, even if no pollution incident has occurred, the Coast Guard and U.S. prosecutors, upon the mere “discovery” of potential by-passing paraphernalia, (such as a flexible hose or suspicious fittings and piping in the engine room), will commence a Grand Jury investigation seeking to prosecute alleged illegal by-passing of the OWS system and/or the presentation of an ORB containing “false entries”.
7. If the recorded quantities of oily bilge water pumped to holding or processed by the OWS directly from the bilge wells does not compare to observed conditions within the machinery space. If the vessel maintains an Incinerator Log, it, too, will likely be inspected by the authorities. If the vessel is utilizing the incinerator to dispose of sludge, the Coast Guard will compare the entries in the Incinerator Log to the corresponding entries in the ORB. If there is a discrepancy between these numbers or if the log indicates that the incinerator is working beyond its rated capacity, suspicions will be raised that the vessel is improperly disposing of sludge. The Coast Guard will also examine the SOPEP to verify that it has been approved by the vessel’s Flag. The Coast Guard will spot check the pollution response equipment listed in the SOPEP and verify that the phone numbers and points of contact listed in the SOPEP are up to date (i.e., National Response Center, local Captain of the Port, or Coast Guard or Sector offices).
Generally, it is well settled U.S. law that in order for a person to be guilty of a crime, the person must act with “criminal intent.” However APPS, like most environmental and public health and welfare criminal statutes, does not require that the government prove that a defendant wrongfully intended to violate the law. Instead, the government need only prove that an actor knowingly committed an act and that act violated an existing law or regulation. For example, the criminal enforcement provision of APPS provides that any person who “knowingly violates” a specific provision of the statute may be guilty of a felony, even if an individual did not know that such conduct was a crime. In addition to criminal fines, if an individual or corporation is found to have violated a provision of APPS or MARPOL, the government can also impose a civil penalty of up to twenty-five thousand dollars ($25,000.00) for each violation. See 33 U.S.C. § 1908(b). APPS places an affirmative duty on the Master, Chief Engineer - or other person in charge - of any vessel subject to APPS to report any “discharge, probable discharge, or presence of oil” while the vessel is within the navigable waters of the United States. APPS places the same duty to report on persons in charge of seaports and oil handling facilities within United States jurisdiction. To ensure compliance with these regulations, the Coast Guard is authorized to inspect any vessel at any U.S. port. If it is determined that a vessel or her crew may have violated pollution prevention laws, its customs clearance will be revoked and the vessel “held-up” until the owner and operator post a surety satisfactory to the Secretary [of the department in which the United States Coast Guard is operating].3 The vessel may also be arrested and sold to satisfy any fine or penalty under APPS. As stated above, APPS applies to every vessel that is operated under the authority of the United States (i.e., “U.S. flagged vessels”). In addition, it is applicable to foreign flagged vessels when these vessels are in the navigable waters of the United States4. This is a critical distinction, since the jurisdiction of the United States to criminally prosecute Owners, Operators and crewmembers of foreign flagged vessels, is strictly limited to acts committed in U.S. navigable waters. Parenthetically, we note that for Owners, Operators, and crewmembers of U.S. flagged vessels there are no such limits on the jurisdiction of the United States to prosecute violations of APPS and MARPOL. Thus, if a U.S. flagged vessel knowingly violates the provisions of APPS or MARPOL anywhere in the world, it can and will be prosecuted by the United States government. In short, it is a class D felony to knowingly violate the provision of APPS. A class D felony is publishable by up to ten (10) years imprisonment, and a fine up to $250,000 for an individual, and up to $500,000 for a corporation, for each violation. A violation of APPS where the individual or corporation did not knowingly violate these sections is punishable by a civil penalty not to exceed $25,000 for each violation.
In addition to APPS, there are a number of other federal environmental protection statutes that make it a crime to discharge oil or waste in U.S. waters. Specifically, the Clean Water Act, 33 U.S.C. § 1251, et seq. prohibits the unpermitted discharge of any pollutant, including a discharge of oil, by any person into navigable waters of the United States5. A “knowing” violation of the Act is a felony. A “negligent” violation of the Clean Water Act is a misdemeanor. Failure to report a discharge is punishable by imprisonment of up to five (5) years, and a fine of up to $250,000 for an individual, and up to $500,000 for a corporation.
Similarly, the Rivers and Harbors Act of 1899, 33 U.S.C. § 401, et seq., provides that any discharge of refuse of any kind from a vessel into navigable waters of the United States is strictly prohibited. A violation of the Act is a misdemeanor. The courts have taken a broad view of what constitutes “refuse” under the Act, and the Act has been extended to a discharge of oil or petroleum.
A person can be convicted of a misdemeanor violation of the Rivers and Harbors Act based solely upon proof that the person placed a banned substance into navigable waters of the United States. A party can also be found guilty of a felony for conduct that does not directly involve the discharge of oil or waste into U.S. waters. Under 18 U.S.C. § 1001, it is a felony to make a false statement to the U.S. Government. To sustain a conviction for a violation of the Act, the Government must only show: (1) that a statement or concealment was made; (2) the information was false; (3) the information was material to a government investigation or activity; (4) the statement of concealment was made “knowingly and willfully;” and (5) the statement or concealment falls within the executive, legislative or judicial branch jurisdiction. The false statement need not be an affirmative statement, but can also include the concealment of the truth when an individual has a duty to answer. For example, a false statement about, or concealment of, any discharge of oil is a violation. Additionally, the U.S. authorities vigorously prosecute individuals and corporations suspected of tampering with witnesses in connection with an on-going investigations. Under 18 U.S.C. § 1512, anyone who knowingly uses intimidation or physical force, threatens, or corruptly persuades another person, or attempts to do so, or engages in misleading conduct toward another person with the intent to hinder, delay or prevent the communications to a law enforcement officer or a judge of the United States of information relating to the commission, or the possible commission, of a federal offense, shall be fined or imprisoned up to ten (10) years, or both. In situations where two (2) or more persons conspire either to commit an offense against the United States, or to defraud the United States, or any agency thereof in any manner or for any purpose, and one or more of such persons do any act to effect the object of the conspiracy, (pursuant to 18 USC § 371), each shall be fined or imprisoned up to five (5) years or both. Recently, the Department of Justice has also been charging crewmembers and vessel owners and operators accused of presenting false records to the government with violations of the Sarbanes-Oxley Act, 18 U.S.C. § 1519.6 This statute is commonly known as the “Enron” statute and was intended to apply to corporate fraud. The significance of utilizing this statute is that it carries a potential jail sentence of 20 years, which is a powerful motivator for someone threatened with prosecution under this statute to turn “state’s evidence’ as the phrase goes. In fact, no vessel Owner, Operator or crewmember has ever been convicted under this statute, although it has been charged in recent Indictments.
6. Seek the advice of competent maritime criminal counsel.
No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a grand jury, except in cases arising in the land or naval forces, or in the militia, when in actual service in time of war or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation. The Fifth Amendment Privilege against self-incrimination is not dependent upon the nature of the proceeding in which the testimony is sought. It is applicable wherever the answer might tend to subject one to criminal responsibility and applies in both civil and criminal proceedings. A seaman may also invoke his Fifth Amendment privileges even if there is no U.S. criminal investigation, but rather may subject the seamen to criminal liability outside of the U.S., so long as the seaman can show that the subject of the government’s questions raises “a real danger of being compelled to disclose information that might incriminate him under foreign law,” and second, that there is a “real and substantial fear of foreign prosecution.” Individual crew members should invoke their Fifth Amendment privilege against self-incrimination until competent counsel is engaged and present. In short, once a criminal investigation has commenced and a mariner invokes his own Fifth Amendment privilege, he is not required to speak with the U.S. authorities and/or respond to any of their questions, which may lead to self-incrimination.
Environmental compliance and the U.S. Government’s prosecution of suspected violations are extremely serious matters. For more information on the subject, please feel free to contact George M. Chalos at gmc@chaloslaw.com.
3 The Coast Guard, acting on behalf of Homeland Security, in order to release the vessel from any Custom’s hold, has generally been demanding bond security in amounts of $1 million or more. In addition, as part of its investigation, the Coast Guard generally removes from the vessel as potential “material witnesses the entire engine room crew and many times other crew members, as well. Consequently, as part of any security agreement for the vessel’s release, the Coast Guard requires, among other things, the vessel owner and/or operator to house, feed and pay the salaries for any crewmembers so removed for periods ranging from 90-270 days. Depending on the length and breadth of the investigation, such expenses can be substantial.
4 The navigable waters of the United States are: 1) the territorial seas of the United States; 2) internal waters of the United States that are subject to tidal influence; and, 3) internal waters of the United States not subject to tidal influence that are or have been used as highways for substantial interstate or foreign commerce. See 33 C.F.R. §2.36(a). Territorial seas of the United States are the waters, 12 nautical miles wide, adjacent to the coast of the United States and seaward of the territorial sea baseline. See 33 C.F.R. §2.22.
5 “Navigable waters of the United States are those waters that are subject to the ebb and flow of the tide and/or are presently used, or have been used in the past, or may be susceptible for use to transport interstate or foreign commerce. A determination of navigability, once made, applies laterally over the entire surface of the waterbody, and is not extinguished by later actions or events which impede or destroy navigable capacity.” See 33 C.F.R. § 329.4.

References: § 1908
 § 1251
 § 401
 § 1001
 § 1512
 § 371
 § 1519
 §2
 §2
 § 329