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Engineer Mohammad Ismail, pictured, and executive Ramesh Shah were identified by the RCMP in a bribery scandal. (CBC)
Engineer Mohammad Ismail, pictured, and executive Ramesh Shah were identified by the RCMP in a bribery scandal. (CBC)

SNC division created web of illicit payments, documents show Add to ...

The RCMP charged that executive, Ramesh Shah, and an engineer who reported to him, Mohammed Ismail, with violating Canada’s foreign bribery law over an alleged conspiracy to bribe their way to the top of a competition to oversee one of the most important infrastructure projects in Bangladesh, the six-kilometre Padma bridge. That alleged scheme, and SNC’s use of the term PCC, was first exposed by the World Bank, which has pulled its $1.2-billion loan for the project. The bank alleged in a letter sent to the Bangladeshi government in January that Mr. Shah had demanded to know from his employees the details of the PCC in connection with the bridge project. “PCC is a euphemism used by SNC-Lavalin to indicate the cost of the bribes to be paid,” wrote Luis Moreno Ocampo, the chairman of a World Bank panel of experts.

The details of the Bangladesh case were recently aired publicly as part of a preliminary inquiry in Toronto and are subject to a court-ordered publication ban. But the documents obtained by The Globe and CBC, as well as interviews with sources from the firm, show that the use of CC and PCC was widespread within the division.

Despite facing criminal charges, Mr. Ismail agreed to an interview about the division’s practice of paying CC or PCC on the condition that he not be asked about the allegations in the Bangladesh bridge case.

He said he first heard the abbreviations from Mr. Shah, his superior at the time, when he moved to the division in February, 2008. “Well, he always instructed people not to use [the word] ‘bribe.’ Just to say PCC, commercial cost, this cost, that cost,” Mr. Ismail said.

“They interchangeably used the word: sometimes project consultancy cost; sometimes project commercial cost; sometimes only CC, commercial cost. But the real fact is [the] intention of that, PCC or CC, is a bribe,” he said.

(Mr. Shah declined to respond to a list of questions, and his lawyer, David Cousins, said he had advised his client not to speak with the media.)

Nowhere was the use of PCC more prevalent, the records show, than in the company’s operations in Nigeria, which is regularly ranked by Transparency International as one of the world’s most corrupt countries. Over the past five years, SNC secured more than $3.3-million in consultancy contracts for World Bank-funded projects in the impoverished West African country. In each of these projects, some in rural states such as Kaduna and Bauchi, and one in the capital city of Lagos, internal company expense sheets include PCC as a line item.

But the real purpose of such payments become clear in the email exchanges between SNC officials and the Nigerian firms the company enlisted. In 2009, the company became embroiled in a dispute with its Nigerian agent, Chief Lucky Egwakhide, over the amount of PCC owed for the Bauchi contract. Chief Egwakhide, who has since died, insisted that SNC had agreed on paying “the client” – the Nigerian government – 15 per cent of the contract and that SNC was going back on its word by reducing the payment to 10 per cent.

“My agreement with the client is [15 per cent],” Chief Egwakhide wrote in an email dated May 20, 2009. “However, if you insist on [10 per cent] work out the difference between what you have sent to date and send the balance urgently. I will have to find a way to pay the difference to the client.”

Other emails from SNC were written to notify the company’s Nigerian partners that a PCC or CC cheque had been sent to them, along with a reminder to “kindly… pay the concerned.” Other times, the division was less discreet; one internal spreadsheet was used to calculate how the company was splitting up its PCC costs with one of its Nigerian partners, a firm called Yaroson & Partners. At the bottom of the spreadsheet is a notation that 366,117 Naira had already been “paid to Musa Tete through Yaroson.” Musa Tete is the Nigerian bureaucrat overseeing the World Bank-financed project to improve road access in the state of Kaduna.

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