March 05, 2013
AgustaWestland says it has opened its books and is providing investigators with “full transparency” as it deals with the aftermath of the Indian helicopter corruption scandal.
Newly appointed CEO Daniele Romiti — who had been in the job just five days — told journalists on the eve of Heli-Expo 2013 here that the company is complying with both Indian and Italian investigators looking into alleged corruption surrounding the sale of 12 AW101 helicopters for use in the VIP role by the Indian air force in 2010.
The scandal broke in early February with the arrest of Giuseppe Orsi, the head of the helicopter manufacturer’s parent company Finmeccanica, and the house arrest of AgustaWestland CEO Bruno Spagnolini. Orsi has since resigned, while Romiti, who was chief operating officer, was selected by Finmeccanica to take over the helm of AgustaWestland in late February.
“We are being fully transparent with the Indian authorities,” Romiti said. He confirmed that India has stopped payments for the aircraft, but said he was confident that the aircraft’s selection by India was conducted properly.
“We are confident that the selection was made in a competitive environment,” he added.
Romiti would not comment on what would happen to the remaining nine aircraft, which are still in various states of production at AgustaWestland’s facility at Yeovil, U.K. But he said three have already been delivered to India and are flying regularly, and that there was positive feedback on the helos.
India has suspended all payments and threatened to cancel the purchase if the charges of bribery of middlemen in India and abroad are proven.
Company officials would not discuss the status of previous CEO Bruno Spagnolini. Unlike Orsi, Spagnolini has not stepped down, and company officials would not say whether he could return if the Italian authorities’ allegations prove false. Asked whether new corporate governance introduced after the scandal would preclude the use of middlemen in transactions, Romiti said the board had not moved to stop such practices.
Following the arrests of Orsi and Spagnolini, India’s Central Bureau of Investigation (CBI) began its own probe of the roles of three middlemen and two India-based private companies allegedly used to channel money to influence the helicopters’ procurement. Finmeccanica denies all wrongdoing, and investigations by both Italian and Indian authorities are continuing. The CBI’s probe should be completed in the coming months, officials say.