Brazilian corruption probe into SNC Lavalin may renew Canadian prosecutors’ interest

MLex Market Insight

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4.9 • 9 Ratings

🗓️ 11 September 2020

⏱️ 17 minutes

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Summary

When Canadian engineering company SNC-Lavalin was named in a bribery investigation in Brazil, it suggested that the company had failed to put its governance failures behind it. The probe by Brazilian federal prosecutors into corruption allegations involving the country’s state-owned nuclear plant is likely to add to the Montreal-based company’s woes back in Canada, where prosecutors have accused SNC-Lavalin of funneling millions of dollars to corrupt Libyan officials. The Brazilian probe is now likely to create a new headache for the company back in Canada.

Transcript

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0:00.0	Welcome back to MLEX's weekly podcast covering all the big regulatory news from around the globe.
0:16.0	My name is James Panicki from Mlex's Asia Pacific team, and it's great to be with you again today.
0:21.6	SNC Lavellin is a Canadian engineering company that's been in the news for all the wrong reasons recently.
0:28.6	Local prosecutors pursued the company over allegations it had funneled millions of dollars to corrupt Libyan officials to obtain business there.
0:36.6	The prosecution was then linked to a political
0:39.4	scandal involving Canadian Prime Minister Justin Trudeau, whose office intervened in 2018
0:45.3	to pressure the country's Attorney General to have prosecutors go easy on the Quebec company.
0:51.7	And now, as Emlex has been named SNC Lavellin has been named in a corruption probe
0:56.5	in Brazil, along with a German and a Danish company over allegations involving Brazil's
1:02.7	state-owned nuclear power company. This is the last thing SNC Lavellin needs at the moment.
1:08.9	And our correspondent Richard Vanderford has examined the twists and the
1:13.6	turns in the case in a fine piece of analysis. And we'll get to that in just a moment.
1:19.1	First though, let's try to set the scene. Cahio Rinaldi covers Brazilian regulatory affairs from our
1:24.7	office in Sao Paulo, and he joins me now. Okay, Kayao, tell me something
1:29.3	about the charges brought by the federal prosecutors against the three companies, including
1:35.1	Lavalin. What exactly have they been accused of doing? Well, these companies, they have been
1:41.9	accused of participating in a corruption scheme at Electronuclear.
1:46.1	That's Brazil's state-owned nuclear energy company.
1:50.1	And they basically agreed to pay fines to the company's former CEO in exchange for having him facilitating payments of contracts that were already signed and effective, but they haven't really
2:03.6	been paid for. So in case of SNC Lavelland, for instance, the company is accused of paying
2:12.6	nearly $606,000 to Electronuclear as former president. That amount at the current exchange rate is equivalent
2:22.0	to $123,000. And the charges have been split into five civil actions. Explain to me how that works.
	...

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