Rolls Royce Takes Us On A World Tour Of Corporate Criminality

Today’s edition of corporate crime literally takes us around the world. The corporate criminal paying the fine today and escaping any real prosecution is Rolls Royce. The company has agreed to an over $800 million fine for violating the anti-bribery laws of the US, the UK, and Brazil. $600 million of that will go to the UK, $170 million to the US, and the remaining $25 million to Brazil. The fines were imposed after it was determined that Rolls Royce bribed officials in at least six countries including Angola, Azerbaijan, Iraq, and Kazakhstan. In Azerbaijan, Rolls Royce paid nearly $8 million in bribes in order to obtain contracts with the state-run oil company. Those contracts resulted in at least $50 million in profit for the company, making the bribes well worth the money. And these were no one-offs. Rolls Royce engaged in this activity for more than a decade and “regularly bribed foreign officials and others in order to secure work”.

The real culprit of this whole bribery scandal is a company called Unaoil. The firm basically was a cutout for major companies like Rolls Royce to bribe local governments without getting their hands dirty. According to the UK’s Serious Fraud Office, it is doubtful “that Unaoil conducts any lawful business” other than bribing governments on behalf of other corporations.  Unaoil conducted “business” in more than a dozen countries, most of which are incredibly corrupt or even under sanctions. The map below from the Huffington Post article shows the countries where Unaoil operates.

There are plenty of other firms besides Rolls Royce that have done business with Unaoil and some of them are huge multinational giants. Samsung, whose president has just been arrested for bribing the now-impeached South Korean President Park Geun-ye, did business with Unaoil, as did the US companies KBR and Honeywell. Unaoil’s banking needs were supplied by Citigroup and HSBC who must have been aware of the payments to the regimes where the bribes took place. All of these firms and other smaller outfits that did business with Unaoil are assumed to be currently under investigation. FMC Technologies, Core Laboratories, and KBR have already confirmed that they are cooperating with the investigation.