The US Justice Department meted out a $40m criminal penalty against Princess Cruise Lines, a unit of Carnival, for illegal dumping of oil and waste during various US port calls.

In pleading guilty to the seven felony charges, Carnival agreed that Princess and other of its cruise line subsidiaries will be required to submit outside audits of their environmental practices for the next five years.

The charges relate to the 3,000-berth Caribbean Princess (built 2004). The ship had used bypass pipe to circumvent an oily water separator and oil content monitor.

The British Maritime and Coastguard Agency received a tip from an engineer aboard the Caribbean Princess that it had discharged oily waste off the coast of England in 2013 with the magic pipe. The information was shared with US Coast Guard (USGC)investigators who examined the ship upon its arrival back in New York City.

USGC said discharges occurred as far back as 2005 at ports along the US East Coast, as well as the US Virgin Islands and Puerto Rico.

In addition to the magic pipe incident, engineers on the Caribbean Princess also engaged in the practice of opening a salt water valve when bilge waste was being processed. The purpose was to prevent the oil content monitor from stopping the discharge. The engineers also pumped oily waste through the ship's greywater system. Four other Princess ships were found to have engaged in similar practices.