Courts & Crime

French firm to pay record $772 million penalty in bribery settlement

The French power and transmission company Alstom SA pleaded guilty Monday to two counts of violating the Foreign Corrupt Practices Act and will pay a record $772.2 million penalty to settle bribery charges, Justice Department officials said.

The company, which has a Connecticut-based subsidiary called Alstom Power, Inc., engaged in a scheme to bribe foreign government officials in order to secure contracts in countries including Indonesia, Saudi Araba, Egypt and the Bahamas, according to prosecutors. Altogether, officals say the company paid tens of millions of dollars in bribes to win $4 billion in projects.

“Alstom’s corruption schme was sustained over more than a decade and across several continents,” Deputy Attorney General James M. Cole said at a news conference. “It was astounding in its breadth, its brazenness and its worldwide consequences.”

As part of the agreement revealed Monday, the subsidiary Alstom Power entered into a deferred prosecution agreement in connection with a one-count criminal information charging it with conspiring to violate the FCPA’s anti-bribery provisions.

The parent company entered a plea of guilty in federal court in Connecticut to one count of violating the law’s books and records provision and one count of violating the law’s internal controls provisions. Assistant Attorney General Leslie Caldwell said the company “dummied up its books and records” to conceal the bribery.

“For years, Alstom has operated in the shadows, secretly lining the pockets of government officials around the globe in order to secrue millions of dollars in public contracts,” Michael J. Gustafson, first assistant U.S. Attorney for the District of Connecticut, said at the D.C. news conference.

In Indonesia, for instance, prosecutors said the company bribed a high-ranking member of the Indonesian Parliament as well as the state-owned electricity company. In Saudi Arabia, officials said, the company hired “consultants” who included two close family members of high-ranking officials at the state-owned electricity company.

Alstom and its subsidiaries also paid over $2.2 million to a charity “associated with a key Saudi official,” prosecutors said.

In its web site, Alstom cites the company’s commitment to the “fundamental principles of integrity and transparency” and, in an earlier press release, announced it was no longer using “sales consultants.”