Alstom agrees to pay $775m penalty to settle bribery charges

22 December 2014 (Last Updated December 22nd, 2014 18:30)

French energy and transportation firm Alstom has agreed to plead guilty and settle the bribery charges leveled against it with the payment of $772m as penalty with the US Justice Department.

French energy and transportation firm Alstom has agreed to plead guilty and settle the bribery charges levelled against it with the payment of $772m as penalty with the US Justice Department.

This would be the largest-ever criminal penalty levied by the US against a firm for violating the foreign bribery laws, reports Reuters.

Alstom has been under probe for paying millions of dollars as bribes to government officials in Indonesia and several other nations to secure energy contracts.

From 2000 to 2011, Alstom paid more than $75m in bribes to win contracts worth $4bn around the world. This helped the firm to earn profits of around $300m.

"Alstom’s corruption scheme was sustained over more than a decade and across several continents."

Alstom admitted to the allegations that its executives had not only paid bribes to government officials, but also falsified records with regard to power deals in several countries such as Saudi Arabia, Egypt, Indonesia, and Taiwan.

Deputy attorney-general James Cole said. "Alstom’s corruption scheme was sustained over more than a decade and across several continents. It was astounding in its breadth, its brazenness, and its worldwide consequences."

Although the power unit of Alstom was acquired by GE for €12.35bn, the former will still pay the fine, reports Reuters.

Earlier this year, GE announced that it would assume control of Alstom’s liabilities, including any penalties.

GE was quoted by the Financial Times as saying: "We’re happy Alstom has resolved the issue. As Alstom has stated, the plea agreement does not materially change the overall economics of the deal."

On Monday, the Serious Fraud Office in the UK charged Alstom’s unit and two executives over bribing officials from 2002 to 2010.