Company - - Jan 17,2017
Rolls-Royce said that it has settled longstanding bribery and corruption cases with the US and UK authorities, for a cost of over 671 million pounds ($809 million).
The UK-based jet and marine engines maker admitted of being guilty in some of its business dealings overseas including in China, Brazil and Indonesia among other markets. Brazilian authorities are probing allegations there.
Serious Fraud Office (SFO), UK’s corruption investigator, began examining the allegations in 2012 and started a formal probe in 2013. The US and Brazilian regulators joined the investigation. The initial probe was focused on the company’s business dealings in China and Indonesia.
According to the settlement, the SFO is set to receive more than 497 million pounds and the US Department of Justice has been settled for an amount of 141 million pounds. The fines will be paid over five years. When Brazilian settlement comes out, Rolls-Royce would pay 21.5 million pounds there.
Rolls-Royce is presently one of the UK's biggest manufacturing exporters and makes engines for civil and military planes, as well as for ships, trains, nuclear submarines and power stations. This company is no longer affiliated with the luxury car maker, which is owned by BMW under the same name.
Rolls-Royce is the major supplier of aircraft engines like the Boeing and Airbus SE, but it has been going through a period of turmoil in the past few years causing numerous management changes and profit warnings. The company also cut its dividend last year for the first time in several years.
This agreement is termed as the highest profile admission of guilt in the corporate sector that UK’s anticorruption authority have been able to secure.
The agreement needs a final approval from a UK court. If approved, Rolls-Royce would be barred of any further prosecution as long as it adheres to the terms of settlement.