BAE fined landmark £280m

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Manufacturing News, Source : TheManufacturer.com
Published : 05 Feb 2010 16:57

BAE Systems has announced settlements totaling $400m with the U.S. Department of Justice and UK’s Serious Fraud Office relating to corruption and false accounting charges.

BAE says that under the arrangement with the Department of Justice, which requires court approval, it will plead guilty to one charge of conspiring to make false statements to the US Government in connection with regulatory filings and undertakings. Regarding investigations with the Serious Fraud Office, BAE will plead guilty to one charge of breach of duty to keep accounting records in relation to payments made to a former marketing adviser in Tanzania — paying a penalty of £30m, comprising a fine to be determined by the court, with the balance paid as a charitable payment for the benefit of Tanzania.

The company issued a statement accepting full responsibility for what it described as “past shortcomings”. Said chairman, Dick Olver, “In connection with the sale of a radar system by the company to Tanzania in 1999, the company made commission payments to a marketing adviser and failed to accurately record such payments in its accounting records. The Company failed to scrutinise these records adequately to ensure that they were reasonably accurate and permitted them to remain uncorrected.

“In the years since the conduct referred to in these settlements occurred, the company has systematically enhanced its compliance policies and processes with a view to ensuring that the company is as widely recognised for responsible conduct as it is for high quality products and advanced technologies.”

Richard Alderman, director of the SFO, said, “I am very pleased with the global outcome achieved collaboratively with the Department of Justice. This is a first, and it brings a pragmatic end to a long-running and wide-ranging investigation.”