Rolls-Royce agrees £671m bribery settlement

The Rolls-Royce Trent-xWB engine. Rolls-Royce has recently been embroiled in bribery claim brought by the Serious Fraud Office relating to bribery and corruption involving intermediaries in a number of overseas markets - image courtesy of Rolls-Royce.
Rolls-Royce said the bribery claims were related to intermediaries in a number of overseas markets - image courtesy of Rolls-Royce.

Rolls-Royce has agreed to pay £671m as a result of bribery and corruption claims in Brazil, the US and UK. The figure is thought to be the largest ever levy imposed and the largest enforcement action relating to any criminal allegation in the UK.

After being investigated for claims dating back to 2012, Rolls-Royce will have to pay £497m to the Serious Fraud Office after the SFO asked for information about possible collusion and bribery in Indonesia, China and other markets.

The firm has also agreed to pay £21.5m to the Brazilian authorities and £141m to the US Department of Justice.

Rolls-Royce is one of the UK’s largest exporters, making engines for planes, trains, ships, nuclear submarines and power stations.

In a statement, the firm said: “These agreements relate to bribery and corruption involving intermediaries in a number of overseas markets, concerns about which the company passed on to the SFO from 2012 onwards.

“These are voluntary agreements which result in the suspension of a prosecution provided that the company fulfils certain requirements, including the payment of a financial penalty.”

The SFO has said that a deferred prosecution agreement had been reached with Rolls-Royce, subject to approval, which will be sought at a public hearing on Tuesday January 17 before Sir Brian Leveson QC, president of the Queen’s Bench Division, at the Southwark Crown Court.

The agreement sees the company pay £497m in three instalments over five years, as well as interest and the SFO’s full costs.

The causes of the offence come from Rolls-Royce’s “intermediaries” which are local firms that handle Rolls-Royce’s products, distribution and repair and management in countries where the British firm does not have a strong workforce presence.

The Derby-based company employs more than 50,000 people worldwide, including over 24,000 in the UK, and operates in 46 different countries.

Rolls-Royce will publish end of year results next month and has said that,”an appropriate update on the implications of these agreements” will be published alongside the results.