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BAE Systems plc |
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(Source: UK Serious Fraud Office; issued Feb. 5, 2010)
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The Serious Fraud Office (SFO) and the US Department of Justice (DoJ) have both announced settlements with BAE Systems plc, in a ground breaking global agreement. The DoJ agreement involves BAE's business dealings in a number of countries, whilst the SFO agreement concentrates on the company's operations in Tanzania.
The SFO has today reached an agreement with BAE Systems that the company will plead guilty in the Crown Court to an offence under section 221 of the Companies Act 1985 of failing to keep reasonably accurate accounting records in relation to its activities in Tanzania.
The company will pay £30 million comprising a financial order to be determined by a Crown Court judge with the balance paid as an ex gratia payment for the benefit of the people of Tanzania.
In conjunction with this agreement the SFO has taken account of the implementation by BAE Systems of substantial ethical and compliance reforms and the company's agreement with the DoJ announced today, and has determined that no further prosecutions will be brought against BAE Systems in relation to the matters that have been under investigation by the SFO.
SFO Director Richard Alderman said, "I am very pleased with the global outcome achieved collaboratively with the DoJ. This is a first and it brings a pragmatic end to a long-running and wide-ranging investigation. I would like to thank the Ministry of Defence Police for their support and contribution. Furthermore, I'd also like to acknowledge the efforts made by BAE to conclude this matter and I welcome its declared commitment to high ethical standards".
Please see link to Director's statement podcast - http://www.sfo.gov.uk/press-room/media-room.aspx
(EDITOR’S NOTE: The US Justice Department had not posted any relevant statement on its website as of Feb. 8 at midday GMT.)
(ends)
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SFO Withdraws Proceedings Against Count Alfons Mensdorff-Pouilly |
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(Source: UK Serious Fraud Office; issued Feb. 5, 2010)
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Following our announcement today about the global agreement between the SFO, the US Department of Justice and BAE Systems plc, the Director of the Serious Fraud Office has considered the position in relation to individuals.
The Director has taken into account that the company has agreed to plead guilty to serious offences both in the UK and in the US and to pay substantial financial penalties. In all the circumstances he has decided that it is no longer in the public interest to continue the investigation into the conduct of individuals.
Consequently the charge brought on 29 January 2010 against Count Alfons Mensdorff-Pouilly in relation to certain European countries is to be withdrawn
This decision brings to an end the SFO's investigations into BAE's defence contracts. (ends)
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BAE Systems Plc Announces Global Settlement with United States Department of Justice and United Kingdom Serious Fraud Office |
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(Source: BAE Systems; issued Feb. 5, 2010)
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LONDON, United Kingdom --- The Company, the U.S. Department of Justice and the UK Serious Fraud Office have reached settlements in connection with the Justice Department investigation announced by the Company on 26th June 2007 and the Serious Fraud Office announced by the Company on 3rd November 2004.
Under the agreement with the Department of Justice, which requires court approval, the Company will plead guilty to one charge of conspiring to make false statements to the U.S. Government in connection with certain regulatory filings and undertakings. The Company will pay a fine of $400 million and make additional commitments concerning its ongoing compliance.
Under the agreement with the Serious Fraud Office, the Company will plead guilty to one charge of breach of duty to keep accounting records in relation to payments made to a former marketing adviser in Tanzania. The Company will pay an agreed penalty of £30 million comprising a fine to be determined by the Court with the balance paid as a charitable payment for the benefit of Tanzania.
The Company issued the following statement from Chairman Dick Olver concerning the settlement:
"In 2000, the Company gave a commitment to the U.S. Government that it would establish and comply with defined U.S. regulatory requirements within a certain period and it subsequently failed to honour this commitment or to disclose its shortcomings.
"In connection with the sale of a radar system by the Company to Tanzania in 1999, the Company made commission payments to a marketing adviser and failed to accurately record such payments in its accounting records. The Company failed to scrutinise these records adequately to ensure that they were reasonably accurate and permitted them to remain uncorrected.
"The Company very much regrets and accepts full responsibility for these past shortcomings.
"These settlements enable the Company to deal finally with significant legacy issues. In the years since the conduct referred to in these settlements occurred, the Company has systematically enhanced its compliance policies and processes with a view to ensuring that the Company is as widely recognised for responsible conduct as it is for high quality products and advanced technologies."
BAE Systems is the premier global defence, security and aerospace company delivering a full range of products and services for air, land and naval forces, as well as advanced electronics, security, information technology solutions and customer support services. With approximately 105,000 employees worldwide, BAE Systems' sales exceeded £18.5 billion (US $34.4 billion) in 2008.
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