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12

Chevron Accused of Fraud in Ecuador

If Ecuador prevails, Chevron likely would face a $6 billion fine

US oil and gas major Chevron has been accused of fraud by the Ecuadorian government.

Reis Veiga, a Chevron Vice President, announced in an email to Ecuadorian journalists that he will defend the company in Quito on Tuesday.

Ecuador's Department of Justice accused Chevron in federal court in New York of deceiving Ecuador officials to secure a legal release after a $40 million environmental remediation by the company in the 1990s.

If Ecuador prevails, Chevron likely would face a $6 billion clean-up tab in addition to liability claimed by citizens in the area for oil-related damages, considered to be some of the most extensive in the world.

Chevron is already a defendant in a separate civil suit in Ecuador that accused the oil giant of dumping more than 18 billion gallons of toxic waste into Ecuador's rainforest between 1964 and 1992, or 30 times more oil than the Exxon Valdez spill. The suit charges the dumping threatens five indigenous groups with extinction and has produced elevated rates of cancer and other health problems.

Ecuador asserts that Chevron lied about cleaning hundreds of open-air toxic waste pits. The government relied on evidence from the civil trial that show levels of toxins hundreds of times higher than E.P.A. and Ecuadorian norms in places Chevron claimed to have remediated.