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Former Rolls-Royce employees plead guilty to bribery

November, 2017

Former employees admitted using commercial agents to bribe government officials.

Former Rolls-Royce employees plead guilty to bribery

Three former Rolls-Royce employees have pleaded guilty to bribing foreign government officials, the US Department of Justice (‘DOJ’) has announced (7 November). The DOJ unsealed charges against the three former employees – James Finley, Keith Barnett and Louis Zuurhout – who worked in the British engineering company’s energy division. Charges were brought against five individuals in total, following parallel investigations by the US and UK authorities into whether bribes were paid to secure contracts over a 14-year period, including one to supply equipment and services to power a gas pipeline from Central Asia to China.

In pleading guilty, the former employees admitted that they had conspired to violate the Foreign Corrupt Practices Act (‘FCPA’) by engaging commercial advisers who would use their commission payments from Rolls-Royce to bribe foreign officials, helping Rolls-Royce to secure an ‘improper advantage’. The energy division of Rolls-Royce was sold to Siemens in 2014.

The indictment of individuals follows the announcement in January of a deferred prosecution agreement between Rolls-Royce and the US, the UK and Brazilian authorities, in which Rolls-Royce admitted to corrupt conduct in its civil aerospace, military and former energy businesses over a period of more than 20 years. The company agreed to pay a penalty of over $800m.

‘The charges announced today against executives, employees, and third parties affiliated with Rolls-Royce, is another example of the Criminal Division’s commitment to holding individuals – and not just corporations – accountable for violating the FCPA,’ said Acting Assistant Attorney General, Kenneth Blanco. ‘Thanks to the coordinated efforts by our prosecutors and agents – working closely with their counterparts in Brazil and at the United Kingdom’s Serious Fraud Office, among others – these defendants, many of whom reside overseas, will face justice in this case, which represents another important step towards leveling the playing field for all ethical and honest businesses.’

Rolls-Royce said in a statement that the company had ‘committed to full ongoing co-operation with the Department of Justice and cannot comment on action against individuals.’

The investigation by the UK’s Serious Fraud Office (‘SFO’) into individuals in Rolls-Royce’s civil, defence, marine and former energy divisions over bribery and corruption continues.

 

For the Department of Justice’s press release, see:

https://www.justice.gov/opa/pr/five-individuals-charged-foreign-bribery-scheme-involving-rolls-royce-plc-and-its-us

For the SFO’s press release, see: https://www.sfo.gov.uk/2017/11/08/guilty-pleas-united-states-arising-investigations-rolls-royces-former-energy-division/

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