Fallout from the Airbus bribery scandal reverberated round the world

Fallout from the Airbus bribery scandal reverberated round the world on Monday because the head of 1 of its top buyers temporarily stood down and investigations were launched in countries aggrieved at being dragged into the increasingly political row.
Airbus agreed on Friday to pay a record $4 billion (3.1 billion pounds) in fines after reaching a plea bargaining with prosecutors in Britain, France and us over alleged bribery and corruption stretching back a minimum of 15 years. Now, it’s bracing for a rocky period with airlines and foreign governments, a number of which have complained they weren’t forewarned about the fees and claimed little knowledge of the sums of cash swirling around their fleet purchases.

“Friday was the top of Act I, now we are seeing the start of Act II with possible repercussions on airline relationships,” said an individual on the brink of the corporate . Airbus declined to comment further after welcoming the agreement on Friday as a chance to “turn the page”. Prosecution documents agreed by Airbus detailed a worldwide network of agents or middlemen in transactions across the group’s business and run from a cell in Paris where the group had a part of its headquarters, split between France and Germany.

Airbus to pay $4 bln to settle corruption probe – French prosecutor

European planemaker Airbus can pay 3.592 billion euros ($3.98 billion) to settle corruption probes by US, British and French authorities into contract dealings, France’s financial prosecutor said on Friday.

Outlines of the operation and its annual budget of 250 million to 300 million euros had been reported by Reuters.Prosecutors also cited parallel projects or investments alongside some negotiations, including the sponsorship by Airbus’ then-parent EADS of a Formula 1 team owned by top officials at AirAsia, a serious customer.

Shares in AirAsia fell up to 11%.AirAsia Group said Chief Executive Tony Fernandes and Chairman Kamarudin Meranun would step aside for a minimum of two months while both the airline and government probed allegations.In a joint statement, the 2 co-founders of Asia’s largest budget airline denied any wrongdoing or misconduct.

“We wouldn’t harm the very companies that we spent our entire lives build up to their present global status.” Fernandes, one among aviation’s best known executives, already faces domestic pressure after backing former Malaysian Prime Minister Najib Razak in 2018 elections

Najib was ousted by Mahathir Mohamad, prompting Fernandes to apologise for backing the loser.

Inquiries Launched

In Ghana, a political storm erupted over accusations of Airbus payments to a relative of a government official in reference to the acquisition of military transport planes.Britain’s Serious Fraud Office (SFO) said the agent had no aerospace experience, having previously worked in football merchandising and as a facilities manager.

It didn’t say what the agent, who had been helped by two unnamed British television actors, did with the cash .President Nana Akufo-Addo’s office said Ghana would “conduct a prompt inquiry to work out the complicity or otherwise of any Ghanaian government official, past or present”. The National Democratic Congress (NDC), which was in power at the time, said claims that Airbus paid bribes were false.

In Colombia, airline Avianca said it had hired a firm to research its relationship with Airbus and determine if it had been a victim of wrongdoing. French prosecutors said in settlement documents that Airbus had agreed to pay multi-million dollar commissions to an agent over jet sales to Avianca, a number of which were earmarked for a senior executive at the airline’s parent Avianca Holdings. The payments were thwarted by a freeze on agent commissions as Airbus tightened processes in 2014, they said. Avianca is ultimately owned by Synergy Group, formerly the vehicle of Bolivian-born entrepreneur German Efromovich who bought the airline out of bankruptcy in 2004 and grew it to become Latin America’s No. 2.

He lost control of Synergy in 2019.

Contacted by Reuters, Efromovich declined to comment.

Sri Lankan President Gotabaya Rajapaksa ordered a full investigation after Britain’s SFO reported that Airbus had hired the wife of a SriLankan Airlines executive as its intermediary in reference to aircraft negotiations.Airbus misled UK credit agency UKEF over her name and gender, while paying her company $2 million, the SFO said.

Korean Air and Taiwan’s China Airlines declined to discuss allegations of payments to intermediaries over jet purchases. Settlements in France and therefore the us also trained a spotlight on dealings in China, which tends to be supplied through large plane orders coinciding with state visits.

Prosecutor findings issued with the settlement detailed alleged bribery and hospitality purchased using money diverted from a pilot training fund, into which Airbus made payments. Analysts had said Airbus is poised to win more business in China as a results of recent US-Chinese trade tensions, though the prospect of a trade deal has also boosted Boeing Co Chinese aviation officials, many suffering from an order to officialdom to figure reception thanks to the coronavirus outbreak, couldn’t be reached for comment.

But the foreign ministry said, “China has always attached great importance to its cooperation with France within the aviation industry”.

admin

Leave a Reply

Your email address will not be published. Required fields are marked *