Montreal (December 19, 2019) – SNC-Lavalin Construction Inc. pleaded guilty on December 18 to one count of fraud over $5,000 in connection with the ongoing Libya fraud case. The Quebec-based construction firm settled a plea deal for the criminal charges related to business dealings the company did in Libya between 2001 and 2011. They admitted that the company paid $48 million in bribes to win contracts in Libya. The court of Quebec accepted the deal which orders SNC to pay a $280 million penalty and places SNC on probation for three years. In return, the charges against the SNC-Lavalin Group Inc. and SNC-Lavalin International Inc. were withdrawn.
After a jury convicted the former SNC-Lavalin Construction president Sami Bebawi on December 15, SNC-Lavalin Construction Inc. settled itself a plea deal regarding their ongoing Libya fraud case, on Wednesday. The subsidiary of the SNC-Lavalin Group Inc. pleaded guilty to one count of fraud over $5,000.
The settlement concludes the news story of the year that damaged the Quebec-based construction firm’s reputation and degenerated into a full-grown political scandal comprising the Prime Minister of Canada and his former Attorney General.
The Libya fraud case
The criminal charges laid on SNC-Lavalin resulted from the business dealings of their construction division in Libya with the regime of late dictator Muammar Gaddafi. They won construction projects such as the Benghazi airport and the ‘Great Man-Made River’ water pipeline, worth $1.8 million in revenue and $104 million in net profit. However, SNC-Lavalin paid $48 million in bribes between 2001 and 2011 to land the contracts in the first place.
The former SNC-Lavalin Construction president, Sami Bebawi, and the former SNC executive in Libya, Ben Aissa, set up shell companies in Switzerland and Panama to cover up the bribes, they paid Muammar Gaddafi’s son, Saadi. In turn, Saadi Gaddafi helped secure the contracts for SNC-Lavalin.
The plea deal
The agreement that was accepted by the Court of Quebec contains a guilty plea from SNC-Lavalin Construction in which they admit defrauding Libya of millions and bribing Saadi Ghadafi for his influence in Libya. Subsequently, SNC-Lavalin Construction will pay a $280 million penalty, which has to be paid over five years. Moreover, the company is placed on probation for three years. During this period, the company is required to engage an independent monitor that reports regularly if the company is complying with anti-corruption laws.
‘This sentence must be a deterrent generally, but must not be crippling,’ said Crown prosecutor Richard Roy.
On the other hand, five of six charges of corruption and fraud, which were laid in 2015 have now been withdrawn. That entails all charges against SNC-Lavalin Group Inc. and SNC-Lavalin International Inc. as well as the bribery charges. The latter caused that SNC-Lavalin will not be affected by a bidding ban for federal contracts or for projects backed by the World Bank.
On behalf of the Board of Directors, Chairman Kevin G. Lynch said in a statement on December 18: ‘[W]e deeply regret this past behaviour which was contrary to our values and ethical standards. The company has changed a great deal, embraced a world-class integrity regime and culture, and going forward we have renewed confidence about the Company’s future.’
Marina Burghard writes for Canadian Fraud News about fraud-related cases, whistleblower, jurisdiction, identity theft, consumer protection, etc. – essentially about scams and how to protect yourself against this kind of fraudulent criminal behavior. She holds a Master’s degree in Political Science where her interest in criminology grew. Besides fraud, Marina’s scientific interest lies in terrorism, extremism and how to deal with it as a society.