Qaddafi-Linked Engineering Firm Raided By Canadian Police

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Photo: Wikimedia Commons

TORONTO (AP) — Canada’s national police force on Friday conducted a search of the headquarters of embattled engineering and construction giant SNC-Lavalin, a company reeling from a scandal over US$56 million in improper payments.SNC issued a statement confirming the Royal Canadian Mounted Police had exercised a search warrant. The company said the warrant relates to an investigation of certain individuals who are no longer employed by the company.

“The company is co-operating fully with all investigations regarding this or any other matters and intends to respond to all requests from the authorities,” said spokeswoman Leslie Quinton. The firm wouldn’t comment further.

The Montreal-based company, one of the world’s largest engineering and construction companies, said last month that it planned to inform police about the results of an internal investigation into $56 million worth of payments related to agents SNC hired to win contracts on two unnamed projects. The probe resulted in the resignation of its CEO and two other senior executives.

Former chief executive Pierre Duhaime resigned after a probe revealed he signed off on payments to undisclosed agents, breaching the company’s code of ethics.

SNC has refused to indicate the whereabouts of the projects involved, or rule out if they included construction projects in Canada.

Chairman Gwyn Morgan had said the company doesn’t believe the payments in question are related to its operations in Libya.

The engineering giant has recently been under fire over its operations in Libya and has defended itself against allegations it had close ties to the family of former dictator Moammar Gadhafi. The company was one of the major Canadian companies doing business in the North African country prior to the fall of Gadhafi last year.

Duhaime, 57, was slated to receive nearly $5 million as a “golden handshake” severance package after he was relieved of his duties.

He will remain an SNC employee until June 27 but will not have any responsibilities or perform any policy-making decisions, the Montreal-based company said in a regulatory filing ahead of its May annual meeting.

SNC-Lavalin has said Duhaime co-operated with its internal investigation, but couldn’t provide details of the payments. Investigators believe those details are known by two former senior employees, including one who has since left the country.

Executive vice-president of construction, Riadh Ben Aissa and vice-president of finance Stephane Roy, parted ways with the company after the board said their conduct had recently been questioned. Their departure coincided with the February launch of a board investigation into $35 million in questionable payments.

The company said Aissa — who did not co-operate with the investigation — authorised the signing of agreements for the projects, which were improperly documented.

He is believed to have left Canada, possibly for Tunisia, according to media reports.

SNC added that Roy may also have knowledge, but he has not been interviewed since prior to his dismissal in February.

It’s not the first time that SNC’s offices have been raided by Canada’s national police force.

The World Bank has temporarily suspended its Bangladesh subsidiary from bidding on new projects while it completes an investigation that prompted police raids of Toronto-area offices last year.

The World Bank signed a deal last April to lend $1.2 billion to Bangladesh to build the bridge over the Padma river, but it said the money won’t be doled out until the investigation has been completed.

SNC-Lavalin has offices across Canada and in more than 40 other countries around the world. It is currently working in about 100 countries.

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