A panel of Swiss judges has granted special intervenor status to SNC-Lavalin in the prosecution of a former senior SNC executive after the Montreal-based engineering giant alleged that the executive, Riadh Ben Aissa, defrauded the company of $50-million (U.S.).
In a recently released decision from the Swiss federal court, the judges detailed how SNC sent an estimated $130-million to two companies that were hired to help SNC secure contracts in North Africa. The companies, “unbeknownst to [SNC],” were in fact controlled by Mr. Ben Aissa, who kept $50-million for himself “in a clandestine way,” the court found.
The Swiss decision, which coincides with the unsealing of Canadian court documents on Tuesday about more alleged bribes Mr. Ben Aissa is suspected of dispensing in his native Tunisia, will allow SNC to access the files of Swiss prosecutors, who arrested Mr. Ben Aissa more than a year ago. The 54-year-old former head of construction for the blue-chip engineering firm has been jailed in Switzerland since April, 2012, while investigators there and in Canada probe the more than $100-million he is alleged to have funnelled through Swiss bank accounts and into the hands of North African leaders, including the son of the late Moammar Gadhafi, in return for contracts.
The Swiss ruling somewhat supports SNC’s contention when the 102-year-old company became engulfed in scandal early last year that it was victimized by a handful of former employees. The company, which has overhauled its management ranks, largely blamed Mr. Ben Aissa and the company’s former chief executive, Pierre Duhaime, for approving $56-million in mysterious payments that it said it could not trace. The panel of Swiss judges wrote of SNC: “Given these circumstances, one must admit that plaintiff can be considered an injured party. Indeed, whether it is from fraud or disloyal management, it is certain that plaintiff’s rights have been wronged directly inasmuch it has suffered economic damages.”
(In the tradition of the Swiss federal court, SNC-Lavalin and Mr. Ben Aissa are not identified by name in the judgment, and are referred to as “A Inc.,” or B, “the former executive vice-president for the construction division of the Canadian group.”)
Mr. Ben Aissa’s Ottawa criminal lawyer, Michael Edelson, was unable to comment before The Globe and Mail’s deadline.
But questions remain about who within SNC approved the payments and how so many suspicious multimillion-dollar transfers slipped through.
Canada’s Public Prosecution Service also released on Tuesday the full contents of an affidavit sworn by RCMP Corporal Brenda Makad that was used to obtain a search warrant executed on SNC’s headquarters last year. A redacted version of the affidavit was released in January.
The recently unsealed portions of the affidavit say SNC routinely sent funds to corporations registered in secretive tax haven jurisdictions that were supposed to help the company win contracts in Libya. For instance, Corporal Makad alleged that SNC paid a 50-per-cent commission in 2001 to a British Virgin Islands company called Duvel Securities Inc., which has no operational office, on a $58-million Libyan contract.
Corporal Makad’s affidavit has also expanded the list of public officials Mr. Ben Aissa is alleged to have bribed. The newly unredacted material shows that Duvel Securities, which the RCMP alleges was controlled by Mr. Ben Aissa, paid the equivalent of about $4.5-million to companies controlled by a Tunisian power broker named Slim Chiboub between 2003 and 2010.
Mr. Chiboub is the son-in-law of former Tunisian dictator Zine el Abidine Ben Ali, and in 2010, SNC was awarded a $340-million contract to construct a thermal power plant in the Tunisian city of Sousse. When Mr. Ben Ali was deposed in the 2011 revolutions that swept over North Africa and parts of the the Middle East, the United Nations placed Mr. Chiboub on a list of Ben Ali family members whose assets were to be frozen or restricted by member countries.