December 06, 2012
Credit: Credit: Rupa Haria
Aerospace and defense group Rolls-Royce may face prosecution after Britain’s Serious Fraud Office (SFO) ordered it to hand over details of possible bribery and corruption in China and elsewhere, the company said Dec. 6.
The world’s second-largest maker of aircraft engines said the SFO had asked it to conduct an internal inquiry into dealings involving intermediaries in China, Indonesia and other overseas markets, which it did not name, and report the results.
“It is too early to predict the outcomes, but these could include the prosecution of individuals and of the company. We will cooperate fully,” Chief Executive John Rishton said.
A source close to the investigation said the allegations relate to events in the “distant past” and Rolls-Royce had told the U.S. Department of Justice about the inquiry.
A separate source said a whistleblower had raised the allegations with the SFO, which then ordered Rolls-Royce to undertake a preliminary investigation earlier this year. The company hired a law firm for the task and passed the results, which had identified matters of concern, to the SFO.
The company, a major British exporter, dates back to 1884 and on its website says it prides itself on its “integrity, reliability and innovation”.
“I want to make it crystal clear that neither I nor the board will tolerate improper business conduct of any sort and will take all necessary action to ensure compliance,” Rishton said in a statement.
“This is a company with exceptional prospects and I will not accept any behaviour that undermines its future success.”
Analysts said past fines within the sector over corruption tended to be relatively small. Any offenses committed in the “distant past” would probably not fall under the British Bribery Act, which came into effect only in July 2011.