“Airbus SE, the world`s second largest aerospace company, was involved in a systematic and deliberate conspiracy that knowingly and intentionally violated U.S. fraud and export laws,” said Special Agent Peter C. Fitzhugh of U.S. Immigration and Customs Enforcement Homeland Security Investigations (HSI) New York. “Airbus` fraud and corruption in commercial aircraft transactions has strengthened corrupt airlines and bad actors around the world at the expense of ordinary businesses. In addition, the corruption of government officials, especially those involved in the acquisition of U.S. military technology, posed a threat to the national security of the United States and its allies. The global threats facing the United States have never been greater than they are today, and HSI New York is committed to working with our federal and international partners to ensure that sensitive U.S. technologies are not acquired illegally and fraudulently. As this investigation shows, national security remains a top priority not only for the Department of Homeland Security, but also for HSI New York. The Company`s payment in the United States will amount to $527 million for FCPA and ITAR violations and an additional $50 million (approximately $55 million) under an ITAR-related civil forfeiture agreement, and the Department will credit a portion of the amount the Company will pay to the National Financial Prosecutor`s Office (PNF) in France under the Company`s agreement with PNF.
In addition, the company agreed to pay a $10 million fine to the U.S. State Department`s Defense Trade Control Directorate (DDTC), whose department credits $5 million. In a related proceeding, the company reached an agreement with the PNF in France over bribes paid to government officials and non-governmental airline executives in China and several other countries, and the company agreed to pay more than €2 billion (more than about $2.29 billion) under the PNF agreement. As part of this coordinated global resolution, the company also entered into a deferred prosecution agreement with the UK`s Serious Fraud Office (SFO) for bribes in Malaysia, Sri Lanka, Taiwan, Indonesia and Ghana, and the company agreed to pay approximately €990 million (approximately $1.09 billion) under the SFO agreement. PNF and SFO had investigated the company as part of a joint investigation team. “Today, Airbus has admitted to a years-long campaign of corruption around the world,” said U.S. Attorney Jessie K. Liu of the District of Columbia.
Through bribes, Airbus has allowed endemic corruption to enter the American system. In addition, Airbus falsely reported information about its conduct to the U.S. government for more than five years in order to obtain valuable licenses to export U.S. military technology. This case is an example of the ability of our prosecutors and law enforcement agencies to work with our foreign colleagues to ensure that corruption is prevented and punished at the highest level in the world. As part of the deferred prosecution agreement with the Department, Airbus has agreed to continue to cooperate with the Department in all ongoing conduct-related investigations and prosecutions, including individuals, and to improve its compliance program. Based on Airbus` settlement with PNF and its approval of supervision by the PNF authorities, as well as Airbus` agreement to provide regular compliance reports, the DOJ decided not to appoint an independent auditor. In a successful case, the Justice Department announced a global settlement with Airbus SE, a manufacturer of civil and military aircraft, under which Airbus agreed to pay more than $4 billion (yes, with a “B”) to resolve charges with the United States, France and the United Kingdom over its role in a corruption scheme and to remedy Airbus` violation of the International Arms Trade (“ITAR”). The Fraud Division is responsible for all investigations and prosecutions under the Foreign Corrupt Practices Act and conducts other investigations into sophisticated white-collar crimes. The Counterintelligence and Export Control Division oversees the investigation and prosecution of cases involving the export of military and strategic goods and technology, including AECA and ITAR cases. In addition, between 2013 and 2015, Airbus hired a trading partner in China and knowingly and deliberately conspired to make payments to the trading partner in order to use them as bribes for government officials in China.
These payments were related to the approval of certain agreements in China relating to the purchase and sale of Airbus aircraft to state-owned and state-controlled airlines in China. In order to conceal the payments and commitment of the trading partner in China, Airbus did not pay the trading partner directly, but made payments to a bank account in Hong Kong on behalf of a company controlled by another trading partner. Airbus` comparison shows the fruits of the DOJ`s recent efforts to align policies across divisions. On the 13th. In December 2019, the DOJ released its Enforcement and Export Policy for Trade Organizations11, whose structure and impact are similar to the DOJ FCPA Enforcement Policy. The export control and sanctions policy was adopted in order to further clarify the previous guidelines published in 2016 and to create incentives for cooperation between companies. The new directive states that if a company (i) voluntarily discloses violations of export controls or sanctions; (ii) cooperate fully; and (iii) remedy in a timely and appropriate manner, there is a presumption that the Company will receive a non-prosecution agreement and will not pay a fine, unless there are aggravating circumstances. Even if there are aggravating factors (including management participation and significant profits), the Directive provides that companies should expect significantly reduced fines and can avoid the imposition of a supervisor. In addition, Airbus has entered into a consent agreement13 with the United States. The U.S. Department of State`s Directorate of Defense Commercial Controls (DDTC) for a period of three years to settle its civil liability for violations of itar.14 Without admitting or denying the allegations contained in the letter of fees proposed by DDTC, Airbus agreed to appoint an independent observer for the duration of the consent agreement;15.
improve its compliance policies, procedures and training; be subject to two audits; and pay a fine of $10 million (half of which is suspended and allocated to corrective action). While DDTC raised the possibility of an administrative exclusion, DDTC decided not to exclude Airbus because Airbus had accepted the other commitments and remedies in the consent agreement. Airbus has entered into a deferred prosecution agreement (“DPA”) and the filing of criminal information accusing Airbus of conspiracy to violate the FCPA`s anti-corruption provision and conspiracy to violate the ITAR. The comparison with Airbus is particularly relevant for aviation and aircraft maintenance, repair and overhaul (MRO) companies and their employees. Industry has always been the third largest industry in terms of the number of FCPA enforcement actions (p.B Rolls-Royce plc, Embraer, BizJet International, LAN/LATAM Airlines, BAE Systems, among others) and has long been a concern of legislators and regulators. So much so that congressional concerns about an airline`s payments to a political campaign are seen as a spurt for the passage of the FCPA. In addition, the FCPA`s first action involved the sale of private jets secured by undue payments from a third-party aircraft manufacturer.9 This highly regulated and global industry does business with state-owned enterprises and is therefore particularly vulnerable to FCPA enforcement actions. MROs, for example, interact heavily with state and controlled units to obtain aircraft maintenance and repair contracts for civil and military fleets.
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