French industrial group Alstom SA pleaded guilty on Monday to paying more than 75 million dollars in bribes to government officials around the world and agreed to a 772.3-million-dollar fine, the largest penalty by the US Department of Justice for foreign bribery, reports The Financial Times.
Alstom pleaded guilty to falsifying books and records, and failing to implement adequate controls over bribes paid to officials in Indonesia, Saudi Arabia, Egypt Taiwan and the Bahamas, the DOJ said.
The payments and gifts helped the company secure 4 billion dollars in power projects around the world, which helped Alstom rake in 300 million dollars in profits.
“Alstom’s corruption scheme was sustained over more than a decade and across several continents,” deputy attorney-general James Cole said. “It was astounding in its breadth, its brazenness and its worldwide consequences.”
The power unit of Alstom has been acquired by General Electric in a 12.35-billion-euro deal but Alstom will still pay the corruption penalty at the insistence of the DOJ.
Earlier this year, both companies said GE would assume all of Alstom’s liabilities, including possible fines.
GE did not comment on the specifics of the fine on Monday but said it had taken account of the DoJ investigation and its potential liabilities in its due diligence.
“We’re happy Alstom has resolved the issue. As Alstom has stated, the plea agreement does not materially change the overall economics of the deal,” GE said in a statement.
As part of the DOJ settlement, Alstom’s Swiss subsidiary, Alstom Network Schweiz AG, pleaded guilty to conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act. Two US subsidiaries, Alstom Power and Alstom Grid, entered into deferred prosecution agreements related to the bribery charges.
Alstom and its subsidiaries admitted to paying bribes to government officials to obtain business for power, grid and transportation projects for state-owned entities. Part of the DOJ’s case centred on Indonesia, where Alstom paid bribes to an Indonesian lawmaker and members of Perusahaan Listrik Negara, the state-owned electricity company in Indonesia, to secure 375 million dollars in contracts.