UK ends fraud investigation into Airbus-related individuals

Monday, 10 May 2021 00:00 -     - {{hitsCtrl.values.hits}}

The UK Serious Fraud Office (SFO) has quietly closed an investigation on individuals associated with European aircraft manufacturer Airbus. It finalises a long-running investigation into fraud, bribery, and corruption allegations across the civil and military aviation businesses at Airbus.

Airbus closes the door on ugly allegations

The SFO opened its investigation into Airbus in July 2016. Investigators zeroed in on irregularities involving third-party consultants across multiple jurisdictions. In the spotlight were deals done in Ghana, Malaysia, Taiwan, Indonesia, and Sri Lanka. Those third-party consultants allegedly bribed customers to buy Airbus aircraft.

In April, Simple Flying reported on a legal action commenced by Sri Lankan Airlines against Airbus. The Colombo-based airline is chasing $ 1 billion in damages after Airbus purportedly offered a Bandar Seri Begawan-based shelf company $ 16.8 million in bribes to help facilitate a deal to buy Airbus planes. Sri Lankan Airlines is also looking to exit that purchase agreement.

 Among other allegations, investigators looked at an alleged $ 50 million payment to Kuala Lumpur-based AirAsia in exchange for an Airbus aircraft order. In Ghana, it is alleged a $ 6 million payment was made to a relative of a government official to smooth the way for a military aircraft order.

In early 2020, Airbus entered into a deferred prosecution agreement (DPA) with the SFO in an attempt to close the book on the investigation. Airbus wasn’t accused of bribery as much as accused of failing to prevent it.

In exchange for a $ 4 billion fine, the SFO, along with US and French authorities, would suspend legal action against Airbus, but not individuals associated with the murky aircraft transactions.

Under the terms of the DPA, the case remains open until January 2023 but prosecution will not proceed as long as Airbus paid the fine and agreed to compliance oversight. In February 2020, Airbus paid the fine.

“Airbus paid bribes through agents around the world to stack the decks in its favour and win contracts around the globe. Corruption like this undermines free trade and fair development,” said Lisa Osofsky, Director of the SFO at the time.

“The SFO investigation remains active and the position in relation to individuals is being considered.

“As part of the DPA, Airbus has agreed to full cooperation with the SFO and its law enforcement partners in any future investigations and prosecutions, and disclosure of any subsequent wrongdoing by the company or its employees, subject to applicable laws. If Airbus does not honour the conditions of the DPA the prosecution may resume.”

Last week, the SFO also quietly dropped its investigation into individuals associated with the aircraft deals. That followed a guilty plea by Airbus subsidiary GPT in relation to corruption concerning work carried out for the Saudi Arabian National Guard.

The allegations concerned military telecommunications work carried out, not aircraft deals. However, GPT and three individuals targeted by the SFO entered guilty pleas Between fines, costs, and confiscation orders, the defendants are now up for approximately $ 41.5 million in penalties.

While Airbus appears to be off the hook in the UK, France, and USA, the DPA does not prevent authorities in other jurisdictions taking action against Airbus or individuals associated with the bribery and corruption allegations.