Canada charges SNC-Lavalin for Libya bribes
Thursday, February 19, 2015 at 11:28AM
Richard L. Cassin in Bangladesh, Ben Aissa, Cambodia, Canada, Great Man Made River Project, Libya, Muammar Gaddafi, Robert Card, SNC-Lavalin, Saadi Gadhafi, Switzerland, World Bank

Robert Card, the President & CEO of SNC-LavalinCanadian engineering and construction giant SNC-Lavalin said Thursday the company and two subsidiaries have been charged with criminal corruption and fraud.

It said the Public Prosecution Service of Canada brought charges against SNC-Lavalin Group Inc., SNC-Lavalin International Inc., and SNC-Lavalin Construction Inc.

"Each entity has been charged with one count of fraud under section 380 of the Criminal Code of Canada and one count of corruption under Section 3(1)(b) of the Corruption of Foreign Public Officials Act," the company said in Thursday's release.

"SNC-Lavalin firmly considers that the charges are without merit and will vigorously defend itself and plead not guilty in the interest of its current employees, families, partners, clients, investors and other stakeholders," the company said.

One corruption charge is based on alleged bribes to public officials related of $47.7 million. The second charge is for fraud of about $130 million related to construction of the Great Man Made River Project in Libya, the Globe and Mail said.

SNC-Lavaiin Group president and CEO Robert Card said, “The charges stem from the same alleged activities of former employees from over three years ago in Libya, which are publicly known, and that the company has co-operated on with authorities since then."

An affidavit prepared by the Royal Canadian Mounted Police in April 2012 tied former SNC-Lavalin executive Riadh Ben Aissa to more than $160 million in alleged bribes paid to Libyan officials in exchange for engineering contracts.

Switzerland's federal crime court accepted a plea deal in October last year with Ben Aissa. He had spent 29 months in a Swiss prison. Under the deal, he reportedly forfeited about $40 million in cash and property.

He was extradited to Canada in October last year and released on bail in mid November.

Ben Aissa has also been named in connection with alleged bribes of $22 million SNC-Lavalin paid for a contract to build the $2.4 billion McGill University Health Center in Montreal.

A Wall Street Journal report in December said "records allege [that] Saadi Gadhafi, the 44-year-old son of the deceased dictator [Muammar Gadhafi], received from SNC-Lavalin officials about $50 million, junkets, a Toronto condo and a luxury yacht in exchange for construction contracts totaling $5 billion to build an airport in Benghazi; a prison in Tripoli; and the world’s largest water project, the Great Man Made River."

In April 2013, the World Bank barred SNC-Lavalin from bank-funded projects for ten years because of alleged corruption in Libya, Bangladesh, Cambodia, and Algeria.

The company's former CEO, Pierre Duhaime, pleaded not guilty in Canada in early 2013 to corruption charges connected to the McGill University Health Center.

CEO Card said Thursday, “Even though SNC-Lavalin has already incurred significant financial damage and losses as a result of actions taken prior to March 2012, we have always been and remain willing to reach a reasonable and fair solution that promotes accountability, while permitting us to continue to do business and protect the livelihood of our over 40,000 employees, our clients, our investors and our other stakeholders.”

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.

Article originally appeared on The FCPA Blog (http://www.fcpablog.com/).
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