Rolls-Royce agrees to pay $809 million to settle bribery allegations
Monday, January 16, 2017 at 2:08PM
Richard L. Cassin in Brazil, China, Deferred Prosecution Agreement, Indoneisa, Serious Fraud Office, rRolls Royce

Rolls-Royce PLC said Monday it has reached agreements in principle with prosecutors in the UK, the United States, and Brazil to settle bribery allegations and will pay about $809 million for the global resolution.

In the UK, Rolls-Royce and the Serious Fraud Office reached agreement in principle for a deferred prosecution agreement that requires payment of £497 million ($599 million) plus interest and the SFO's costs. The payments will be made under a schedule lasting up to five years.

The proposed DPA needs court approval. A hearing has been set for January 17 in London.

In the United States, Rolls-Royce said it agreed to pay the Justice Department about $170 million.

And in Brazil, it will pay the Ministério Público Federal $25.5 million.

Rolls-Royce announced the settlements in a release Monday. It said its total payments under the agreements will be about £671 million ($809 million).

The SFO confirmed the UK portion of the global resolution in its own statement Monday. In the United States, federal agencies were closed Monday for Martin Luther King Day and will reopen Tuesday.

Rolls-Royce said Monday it has "co-operated fully with the authorities and will continue to do so."

It said the settlements "relate to bribery and corruption involving intermediaries in a number of overseas markets, concerns about which the company passed to the SFO from 2012 onwards."

The company said its payments in the first year of all three agreements would be £293 million ($353 million).

The SFO launched a formal investigation into Rolls-Royce in late 2013.

The UK-based firm is Europe's largest manufacturer of aircraft engines.

The investigation at first centered on Rolls-Royce's business in China and Indonesia and reports that the company paid bribes through intermediaries there and in other markets.

In December 2012, in response to a request from the SFO, Rolls-Royce provided information about third-party vendors that handled sales, distribution, repair and maintenance work.

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Richard L. Cassin is the publisher and editor of the FCPA Blog.

Article originally appeared on The FCPA Blog (http://www.fcpablog.com/).
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