Rolls-Royce has agreed to pay a record €776 million fine to US, UK and Brazilian authorities to settle corruption claims.
Regulators are said to have been investigating allegations that the firm paid millions of euros in bribes – or used middlemen to do so – to win military and civil contracts in around a dozen countries. Rolls is said to have offered the kickbacks to smooth sales of its jet engines.
In 2012, the company passed information to Britain’s Serious Fraud Office (SFO) about allegations of malpractice in China and Indonesia, prompting UK investigators to launch a formal probe. The firm said at the time it had discovered “matters of concern” in a number of other overseas territories.
Rolls made the multi-million euro payments to the SFO, along with the US Department of Justice and Brazil’s Ministerio Publico Federal.
In a statement, the company said: “These agreements relate to bribery and corruption involving intermediaries in a number of overseas markets, concerns about which the company passed on to the SFO from 2012 onwards.
“These are voluntary agreements which result in the suspension of a prosecution provided that the company fulfils certain requirements, including the payment of a financial penalty.”
It was yesterday unclear whether the payments settled all claims against the carmaker, or just some of them. In the UK, the company struck a deferred prosecution agreement (DPA) with the SFO, which means it will avoid going to court over the allegations so long as it abides by certain conditions, including the payment of the fine.
Rolls said it has cooperated fully with the investigations into its conduct, and would continue to do so. The company will publish its full-year results next month, at which point it said it will provide an update on the effect the settlements will have its balance sheet.
The SFO is carrying out a similar investigation into Airbus, which is also said to have paid bribes to secure sales of its aircraft. The European plane manufacturer said it flagged suspicious activity to the fraud squad itself, resulting in a probe into the firm’s conduct being launched last summer. The move came after the British government said in April it was seeking information from Airbus about the activities of its overseas agents.
In a statement issued at the time, Airbus said: “Airbus Group has been informed by the SFO that it has opened a criminal investigation into allegations of fraud, bribery and corruption in the civil aviation business of Airbus Group relating to irregularities concerning third party consultants. Airbus Group continues to cooperate with the SFO.”
Airbus said the investigation would focus on allegations of fraud, corruption and bribery in its civil aviation business.