Welcome to This Week In Compliance: GAN’s weekly news roundup, where we curate the latest stories on compliance and anti-corruption to keep you informed. This week we cover multiple investigations launched following Airbus’ record-breaking USD 4 billion settlement. Keep reading for this breaking story and find more news below:
Malaysia Regulator to Probe if AirAsia Broke Rules in Airbus Deals:
Malaysia’s securities regulator said late last week that it will look into whether AirAsia Group and subsidiary AirAsia X broke securities laws after U.K. prosecutors accused executives at the airline of receiving bribes from airplane manufacturer Airbus for buying planes. The allegations were contained in documentation as part of the settlement Airbus struck with the U.K.’s Serious Fraud Office (SFO) for a record USD 4 billion as part of a settlement involving France, the U.K., and the U.S. The SFO found that Airbus’ then-parent company EADS paid USD 50 million to sponsor a sports team that was jointly owned by two unnamed AirAsia executives. AirAsia has said that it will fully cooperate with “relevant authorities where required”.
The U.S. Could Face Difficulties Sanctioning Danske Over Money-Laundering:
According to a report by S&P Global Market Intelligence, U.S. authorities may face difficulties fining Danske Bank over their involvement in the Baltic money laundering scandal. The report cites a former U.S. attorney who asserts that the U.S. fine will most likely be lower than expected because the bank does not possess a banking license in the U.S. Danske is already under investigation by the U.S. Department of Justice and the U.S. Security and Exchange Commission and has stated they are cooperating with all relevant authorities on the issue.
Colombia's Avianca Embroiled in Airbus Bribe Scandal:
After the French Anti-Corruption Agency's (AFA) investigation into Airbus revealed that the company attempted to paid bribes to an Avianca executive, the airline has opened up an internal investigation into its relationship with Airbus. Airbus was recently charged by different authorities with paying bribes to intermediaries to secure contracts with Airlines across the globe. In Colombia, Airbus reportedly entered into agreements with a local commercial intermediary to secure contracts with Avianca which resulted in part of that payment almost being used as a bribe for one of Avianca's executives. While the payments were frozen in 2014 following the airline's adoption of enhanced compliance measures, the executive played a pivotal part in negotiating the contract between Avianca and Airbus for the sale of 180 A320neo aircraft.
Fed Bars Goldman Sachs Exec From Banking Industry Over 1MDB Scandal:
A former Goldman Sachs executive who was involved in Malaysia's 1MDB corruption scandal was permanently barred from the banking industry by the U.S. Federal Reserve. Andrea Vella, former head of Goldman Sachs Asia’s investment bank unit, was accused of failing to provide accurate information on Jho Low's involvement in the bond offerings between Goldman and Malaysia's sovereign wealth fund. Low, who was charged by US authorities for stealing billions of dollars from the 1MDB fund, had already been flagged as a 'person of concern' by Goldman Sachs. Vella was in charge of providing full information to Goldman and for supervising personnel to ensure an appropriate review of the transaction. Vella declined to comment on the matter.
Odebrecht Agrees to Extend the DOJ's Corruption Monitoring:
Odebrecht, the Brazilian construction conglomerate at the center of Brazil’s Operation Car Wash anti-corruption campaign, agreed this week to extend the monitorship by the U.S. Department of Justice as part of its corruption plea deal, following the company’s failure to comply with some conditions of the agreement. The DOJ said in court filings that Odebrecht failed to allow the DOJ monitor to complete the monitorship and the company also failed to maintain a compliance and ethics program. Odebrecht said in a statement that the extension was due to “financial issues” with the payment of monitors.
South African Court Issues Arrest Warrant For Jacob Zuma:
Former South African President, Jacob Zuma, was issued an arrest warrant after his lawyer declared Zuma was too ill to attend the court hearing. Zuma, who has been accused of corruption, racketeering, and money laundering, was forced to step down from power in 2018. While Zuma's defense expressed dissatisfaction with the court's ruling, the arrest warrant will not come to effect until May when the court resumes the former President's case.
Fake ‘French minister’ in €50m scam:
A trial on seven suspects who were accused of using silicone masks to impersonate France's foreign minister began this week in Paris. The suspects are under investigation for using the masks for extorting €50 million from 150 individuals including businessmen, religious figures and politicians. There are two main suspects and five others face lesser complicity charges.