Canadian engineering and construction giant SNC-Lavalin has pleaded guilty to one charge of fraud and will pay a $280-million fine in relation to its dealings in Libya, federal prosecutors announced in court Wednesday in Montreal.
The prosecution is also recommending that five other fraud and corruption charges filed against SNC-Lavalin, SNC-Lavalin Construction, and SNC-Lavalin International be dropped.
The Montreal-based company, which found itself at the centre of a political scandal earlier this year, was facing a criminal trial on several charges related to its past business dealings with the family of the late Libyan dictator Moammar Gadhafi.
SNC-Lavalin was accused of paying $47.7 million in bribes to public officials in Libya between 2001 and 2011. SNC-Lavalin, its construction division and a subsidiary also faced one charge each of fraud and corruption for allegedly defrauding various Libyan organizations of $129.8 million.
The prosecution and defence are both recommending the $280-million fine to be paid over five years, and that SNC-Lavalin Construction be placed on probation for three years.
SNC-Lavalin Group Inc. will engage an independent monitor who will provide initial and annual reports, executive summaries of which will be posted on the company’s website, and will make any changes to its compliance and ethics programs that are identified by the independent monitor and are required, the company said in a press release.
SNC-Lavalin group is already subject to monitoring by Public Services and Procurement Canada and the World Bank, and has put in place a robust ethics and compliance program that meets the highest international standards, the company said.
“This is a game-changer for the company and finally allows us to put this issue behind us,” Ian L. Edwards, SNC-Lavalin president and CEO, said in a statement. “I apologize for this past misconduct and welcome the opportunity to move forward. We are beginning an exciting new chapter that is focused on our future growth and further de-risking our business.”
With the withdrawal of the charges against SNC-Lavalin Group Inc. and SNC-Lavalin International Inc., “the settlement mitigates uncertainty and distraction that has been a drag on performance,” Edwards said.
The company does not anticipate that the guilty plea by a construction subsidiary (which has not bid on any new contracts since it was charged in 2015) will affect the eligibility of SNC-Lavalin Group companies to bid on future projects, Edwards said.
A former SNC-Lavalin senior executive was found guilty Sunday of corruption and fraud charges related to the company’s dealings in Libya.
A jury in Montreal found Sami Bebawi, former head of SNC-Lavalin’s international construction division, guilty of all five charges he faced, including fraud, corruption of foreign officials and laundering of proceeds of crime in a separate court case, related to the same events in Libya.
The engineering and construction firm has been at the centre of a political controversy following accusations by former attorney general Jody Wilson-Raybould that top government officials pressured her to overrule federal prosecutors and negotiate a deferred prosecution agreement (DPA) with the company.
The DPA would allow the company to pay a fine rather than face a criminal trial.
Wilson-Raybould resigned from cabinet in February following media reports that her demotion from the justice portfolio to veterans affairs in a January cabinet shuffle was caused by her refusal to intervene in the criminal prosecution of SNC-Lavalin.
Former Treasury Board President Jane Philpott also resigned from cabinet, saying she lost confidence in the government’s handling of the affair.
The scandal also resulted in the resignation of Trudeau’s principal secretary Gerald Butts and the early retirement of Michael Wernick, the former clerk of the Privy Council.
An Ethics Commissioner’s report concluded that Prime Minister Justin Trudeau violated ethics laws when he tried to persuade Wilson-Raybould to reverse her decision to not grant the agreement.
Wilson-Raybould and Philpott ran in the 2019 federal election as Independents. Philpott didn’t succeed, but Raybould became the only Independent to be elected to Canada’s 43rd Parliament in the Oct. 21 election.
“2019 began with very public questions about the rule of law in our country,” Wilson-Raybould tweeted Wednesday. “I am glad to see it end with that principle being upheld. The justice system did its work. It is time to move forward and for the company to look to its future.”
I have long believed in the essential necessity of our judicial system operating as it should—based on the rule of law and prosecutorial independence, and without political interference or pressure. (1/3)
— Jody Wilson-Raybould 王州迪 Vancouver Granville (@Puglaas) December 18, 2019
With files from CBC News and The Canadian Press