CRIMINAL CAPITALI$M
ABB to pay USD315M to settle US charges over South Africa bribes
December 4, 2022
NEW YORK (AFP) – Swedish-Swiss industrial company ABB agreed to pay USD315 million to settle United States (US) criminal charges that it bribed state-owned Eskom of South Africa over government contracts, the Department of Justice (DOJ) announced on Friday.
Two affiliates of ABB each pleaded guilty to one count of conspiracy to violate the US Foreign Corrupt Practices Act as part of a three-year deferred prosecution agreement, the US agency said of a settlement that was coordinated with government authorities in Switzerland, Germany and South Africa.
The issue concerns a troubled project near Johannesburg with the Kusile power station, the fourth largest coal-fired generator in the world, which has been fraught with allegations of graft. South Africa’s struggling power utility Eskom commissioned the plant in 2007.
In October eight people, including former Eskom CEO Matshela Koko, were arrested on corruption charges linked to the ABB work.
Between 2014 and 2017, ABB through its subsidiaries secured “multiple” government contracts, syphoning illicit payments through subcontractors associated with an official at Eskom, South Africa’s state-owned power company, the DOJ said.
“ABB worked with these subcontractors despite their poor qualifications and lack of experience,” the DOJ said in a news release. “In return, ABB received improper advantages in its efforts to obtain work with Eskom, including, among other benefits, confidential and internal Eskom information.”
ABB engaged in “sham” negotiations with the Eskom official and falsely reported the payments as legitimate business expenses, according to the press release.
ABB Chief Executive Bjorn Rosengren said the company has acted in the wake of the case by “launching a new code of conduct, educating employees and implementing an enhanced control system to prevent something similar from happening again.”
In a statement, he said that ABB has “a clear zero tolerance approach to non-ethical behaviour within our company.”
The US agency said the penalty was reduced 25 per cent from the high end of the sentencing range in light of ABB’s “extraordinary” cooperation and “extensive” remediation efforts.
But the department noted that ABB had two earlier criminal FCPA resolutions in 2004 and 2010, as well as a guilty plea by an ABB entity for bid rigging in 2001.
The US law on foreign corrupt practices applies to foreign companies with US-issued stock, as is the case with ABB.
The company also settled a parallel civil case with the Securities and Exchange Commission.
Earlier Friday, the Swiss attorney general’s office said the company was fined CHF4 million (USD4.3 million) in the case.
ABB said it hoped to reach a resolution with German authorities in the near term.
ABB to pay USD315M to settle US charges over South Africa bribes
December 4, 2022
NEW YORK (AFP) – Swedish-Swiss industrial company ABB agreed to pay USD315 million to settle United States (US) criminal charges that it bribed state-owned Eskom of South Africa over government contracts, the Department of Justice (DOJ) announced on Friday.
Two affiliates of ABB each pleaded guilty to one count of conspiracy to violate the US Foreign Corrupt Practices Act as part of a three-year deferred prosecution agreement, the US agency said of a settlement that was coordinated with government authorities in Switzerland, Germany and South Africa.
The issue concerns a troubled project near Johannesburg with the Kusile power station, the fourth largest coal-fired generator in the world, which has been fraught with allegations of graft. South Africa’s struggling power utility Eskom commissioned the plant in 2007.
In October eight people, including former Eskom CEO Matshela Koko, were arrested on corruption charges linked to the ABB work.
Between 2014 and 2017, ABB through its subsidiaries secured “multiple” government contracts, syphoning illicit payments through subcontractors associated with an official at Eskom, South Africa’s state-owned power company, the DOJ said.
“ABB worked with these subcontractors despite their poor qualifications and lack of experience,” the DOJ said in a news release. “In return, ABB received improper advantages in its efforts to obtain work with Eskom, including, among other benefits, confidential and internal Eskom information.”
ABB engaged in “sham” negotiations with the Eskom official and falsely reported the payments as legitimate business expenses, according to the press release.
ABB Chief Executive Bjorn Rosengren said the company has acted in the wake of the case by “launching a new code of conduct, educating employees and implementing an enhanced control system to prevent something similar from happening again.”
In a statement, he said that ABB has “a clear zero tolerance approach to non-ethical behaviour within our company.”
The US agency said the penalty was reduced 25 per cent from the high end of the sentencing range in light of ABB’s “extraordinary” cooperation and “extensive” remediation efforts.
But the department noted that ABB had two earlier criminal FCPA resolutions in 2004 and 2010, as well as a guilty plea by an ABB entity for bid rigging in 2001.
The US law on foreign corrupt practices applies to foreign companies with US-issued stock, as is the case with ABB.
The company also settled a parallel civil case with the Securities and Exchange Commission.
Earlier Friday, the Swiss attorney general’s office said the company was fined CHF4 million (USD4.3 million) in the case.
ABB said it hoped to reach a resolution with German authorities in the near term.
THEY WILL NEED IT FOR THE FINES
Reuters | November 21, 2022 |
Credit: ABBABB has raised around 200 million Swiss francs ($209 million) from selling an 8% stake in its electric vehicle (EV) charging business, as the Swiss engineering and technology company drums up interest in a unit it hopes to float next year.
The private placement of shares was led by investors with links to Swedish furniture giant IKEA and car dealership chain AMAG and gives the E-mobility business an equity value of 2.4 billion to 2.5 billion francs.
Investors expect a surge in demand for EV charging points as European regulations push automakers and drivers alike to make the switch from fossil-fuelled cars.
The placement is a positive sign for ABB after the company earlier this year delayed a planned flotation of E-mobility, citing stock market turbulence.
The Swiss group, which will retain 92% of E-mobility, has indicated it now plans to carry out the flotation in the second half of 2023.
Proceeds from the stake sale will be used by E-mobility to grow organically and make acquisitions in hardware and software, ABB said.
The new investors include Interogo Holding, as well as moyreal holding, a Swiss family office, and E-mobility chairman Michael Halbherr.
Interogo, an international investment group based in Switzerland, is owned by Interogo Foundation, the ultimate owner of Inter IKEA Group, the group of companies that connects franchisees of the Swedish furniture company. Moyreal is the investment vehicle of AMAG car dealership heiress Eva Maria Bucher-Haefner.
ABB did not give the breakdown of the individual stakes given in return for the investment.
“We remain committed to our strategy to separately list our E-mobility business subject to constructive market conditions,” ABB CEO Bjorn Rosengren said in a statement.
“The private placement underpins our joint commitment to ensure ABB E-mobility’s fast growth in order to remain best positioned to lead the sector in EV charging solutions.”
($1 = 0.9570 Swiss francs)
(By John Revill; Editing by Mark Potter and Emelia Sithole-Matarise)
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