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« A Baker’s Half Dozen FCPA Issues for the First Half of 2012 | Main | What The Buzz Is All About »
Tuesday
Jun262012

SNC-Lavalin Execs Charged In Canada

Two executives from Montreal-based engineering firm SNC-Lavalin Group Inc were charged in a Toronto court Monday for bribing officials in Bangladesh. 

Canada's Corruption of Foreign Public Officials Act makes it an offense to directly or indirectly give or offer a loan, reward, advantage, or benefit of any kind to a foreign public official 'in order to obtain or retain an advantage in the course of business.'

Reuters reported that the Royal Canadian Mounted Police arrested Ramesh Shah, 61, and Mohammad Ismail, 48, last year following a raid on SNC-Lavalin's offices. The raid was part of an investigation of bidding practices for the $1.2 billion Padma Bridge project in Bangladesh.

Their trial will begin next year.

Reuters said the World Bank, which was funding the project, alerted Canadian authorities to potential corruption by bidders.

SNC-Lavalin, which trades on the Toronto Stock Exchange, bid for a project management role but didn't win the work. The World Bank has since suspended funding.

This is the second prosecution in Canada for bribes to officials in Bangladesh.

In June last year, Niko Resources, a publicly traded oil and gas company based in Calgary, was fined C$9.5 million (US$9.7 million) after pleading guilty to bribing a Bangladeshi minister.

It was the first plea deal struck by a corporate defendant under the Corruption of Foreign Public Officials Act.

Reuters said SNC-Lavalin is also under investigation for $56 million in payments to non-existent agents on construction contracts. That investigation led to the resignation in March this year of the company's CEO.

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