Airbus, Europe’s largest aerospace multinational bribed public officials and hid the payments as part of a pattern of worldwide corruption, prosecutors said on Friday [January 31, 2020] as the European plane maker agreed a record $4 billion settlement with France, Britain and the United States.
In relation to Ghana, the plane maker has admitted to paying huge bribes in order to secure contracts in Ghana, during the President John Mills and John Mahama administration between 2011 and 2015.
The Reuters News Agency for instance reported that on defense deals, Airbus is said to have hired and disguised payments to a close relative of a government official in Ghana with no aerospace experience in connection with a sale of military transport planes, the SFO [Serious Fraud Office] said.
Airbus was found guilty by a High Court in London and is to pay a fine of £3 billion as penalties.
Anti-corruption investigators according to a report by The Guardian describes the court’s decision as the largest ever corporate fine for bribery in the world after judges declared the corruption was “grave, pervasive and pernicious.”
“The plane maker agreed to pay the penalties on Friday after reaching settlements with investigators in the UK, France and the US to end inquiries that started four years ago,” the report stated.
The disclosures, made public after a nearly four-year investigation spanning sales to more than a dozen overseas markets, came as courts on both sides of the Atlantic formally approved settlements that lift a legal cloud that has hung over Europe’s largest aerospace group for years.
“It was a pervasive and pernicious bribery scheme in various divisions of Airbus SE that went on for a number of years,” U.S. District Judge Thomas Hogan said, according to the Reuters report.
The deal, effectively a corporate plea bargain, means Airbus has avoided criminal prosecution that would have risked it being barred from public contracts in the United States and European Union – a massive blow for a major defense and space supplier.
Prosecutors said individuals could still face criminal charges, however.
Airbus, whose shares closed down 1%, has been investigated by French and British authorities for alleged corruption over jet sales dating back more than a decade. It has also faced U.S. inquiries over suspected violations of U.S. export controls.
“In reaching this agreement today, we are helping Airbus to turn the page definitively” on corrupt past practices, French prosecutor Jean-Francois Bohnert said.
PHOTO: Ghana’s Military aircraft C295 was mentioned in the court document
On Ghana
Allison Clare, for the SFO, told the court the company had paid bribes in Malaysia, Sri Lanka, Indonesia, Taiwan and Ghana between 2011 and 2015, The Guardian reported.
Airbus, which admitted five counts of failing to prevent bribery, had used a network of secret agents to pay large-scale backhanders to officials in foreign countries to land high-value contracts.
This was run by a unit at its French headquarters, which its one-time chief executive Tom Enders reportedly called “bullshit castle”.
French prosecutors examined bribes to other countries including China, Japan, Russia, Kuwait, Brazil and Turkey.
Hugo Keith, for Airbus, said the settlement will “draw a line under the investigation and the grave historical practices” exposed by prosecutors.
Airbus hopes the settlements, approved by courts in the three countries, will end turbulence within its management which had led to scores of senior executives being sacked. The firm is one of the largest employers in the UK, with a workforce of 13,500, The Guardian reported.
Ghana under late President John Evans Atta Mills in 2011 and former President John Mahama in 2015, acquired three Airbus C295 planes from the company as part of an effort to augment and modernize the fleet of the Ghana Armed Forces.
It emerged that the first order of the military aeroplane arrived in Ghana on November 17, 2011, followed by a second on March 19, 2012. The last order arrived in the Ghana on December 4, 2015.
President John Dramani Mahama, in November 2014, announced that Ghana was to acquire an additional C295, in addition to other aircraft, including five Super Tucanos, Mi-17s and four Z-9s.
A total of about $150 million was spent in acquiring all the three aircraft, one of which overshot the runway recently. Ghana’s Ministry of Defence stated that the accident happened because the aircraft had not gone for its scheduled maintenance.
Prosecution on Ghana
The prosecutor stated: “Between July 1, 2011, and June 1, 2015, Airbus SE failed to prevent persons associated with Airbus SE from bribing others concerned with the purchase of military transport aircraft by the Government of Ghana, where the said bribery was intended to obtain or retain business or advantage in the conduct of business for Airbus SE.”
Airbus “between 2009 and 2015 engaged intermediary 5, a close relative of a high ranking elected Ghanaian government official (Government Official 1), as its BP in respect of the proposed sale of three aircraft to the government of Ghana. A number of Airbus employees knew that intermediary 5 was a close relative of Government Official 1, a key decision maker in respect of the sales. A number of Airbus employees made or promised success based commission payments of approximately £5 million to the intermediary. False documentation was created by or with the agreement of Airbus employees in order to support and disguise these payments. The payments were intended to induce or reward improper favour by the Government Official 1 towards Airbus,” parts of the prosecution case relating to Ghana read.
Intermediary 5, according to the court document, is a UK national born in Ghana. He was brought to the United Kingdom as a young child and lost touch with his Ghanaian family until the late 1990s. He had no prior experience or expertise in the aerospace industry.
“A CV provided to Airbus in 2011 listed Intermediary 5’s employment before 2009 as an events manager for a local authority, director of a football merchandising company and facilities manager for an estate management business.
“Intermediary 5 was assisted in his Airbus work by two other UK nationals: Intermediary 6 and Intermediary 7.
“Intermediary 6 has publicly described Intermediary 5 as his “best friend”. There is no evidence which suggests that either Intermediary 6 or Intermediary 7 had any prior experience or expertise in the aerospace industry.
“A CV that Intermediary 6 provided to Airbus in 2011 listed his pre-2009 employment as a UK television actor and film director. Intermediary 7 was also a former UK television actor,” the document further added.
Read a copy of the court documents in the attachment below.
