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Business News/ Companies / News/  Rolls-Royce agrees to pay $808 million on bribery claims
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Rolls-Royce agrees to pay $808 million on bribery claims

Britain's Serious Fraud Office says the matter covers 12 counts of conspiracy to corrupt, false accounting and failure to prevent bribery in conduct spanning three decades

Rolls-Royce said in a statement that the ‘voluntary agreements’ will result in the suspension of prosecution. Photo: AFPPremium
Rolls-Royce said in a statement that the ‘voluntary agreements’ will result in the suspension of prosecution. Photo: AFP

London: Jet engine maker Rolls-Royce has agreed to pay £671 million to settle bribery and corruption charges brought by authorities in Britain, the US and Brazil.

UK High Court judge Brian Leveson approved a deferred prosecution agreement during a public hearing on Tuesday. The agreement follows a four-year investigation, which will continue to look at the conduct of individuals.

Britain’s Serious Fraud Office said the matter covers 12 counts of conspiracy to corrupt, false accounting and failure to prevent bribery in conduct spanning three decades. It was the largest-ever investigation carried out by the Serious Fraud Office and cost £13 million.

“Bribery harms the reputation of the UK as a safe place to do business," said David Green, the SFO director. He said the agreement “allows Rolls-Royce to draw a line under conduct spanning seven countries, three decades and three sectors of its business."

Rolls’ civil aerospace, defence aerospace businesses and former energy businesses were involved in matters relating to aero engines, energy systems and related services. The UK’s agreement covered conduct in Indonesia, Thailand, India, Russia, Nigeria, China and Malaysia.

US Justice Department officials have said that part of the business obtained through the scheme was for Rolls-Royce Energy Systems Inc., a Rolls-Royce subsidiary based in Mount Vernon, Ohio.

Rolls-Royce said in a statement that the “voluntary agreements" will result in the suspension of prosecution. Company CEO Warren East apologized and said the behaviour of the past was “completely unacceptable".

“This was unworthy of everything which Rolls-Royce stands for, and that our people, customers, investors and partners rightly expect from us," he said in a statement. “The past practices that have been uncovered do not reflect the manner in which Rolls-Royce does business today."

The company said it had cooperated with authorities and would continue to do so.

Under the terms of the deal, the company will pay £497 million plus interest to British authorities on a schedule of up to five years. It will pay the US authorities $169 million and $25.6 million to the Brazilians.

Transparency International’s UK executive director Robert Barrington says individuals should be prosecuted so the case serves as a deterrent to bribery.

He argued, however, that the hint of prosecutions of individuals involved is too vague to assess whether the public interest has really been served. “A fine is insufficient as a punishment and deterrent, because at face value, it sends an unfortunate message that large companies can escape criminal prosecution by paying their way out — somewhat ironically for a bribery case," Barrington said.

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Published: 18 Jan 2017, 09:11 AM IST
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