The Rs 6 cr bribe to babus: All you need to know about Louis Berger bribery scandal
New Jersey-based construction management firm Louis Berger has come under a cloud of controversy after being charged with bribing Indian officials to win water developmental projects in Goa and in Guwahati.
New Jersey-based construction management firm Louis Berger has come under a cloud of controversy after being charged with bribing Indian officials to win water developmental projects in Goa and in Guwahati. The bribery of $976,630 for a Goa project by Louis Berger included payments to a minister, details of which have not been disclosed by the US Department of Justice. Here's a look at all major developments in the case.
Louis Berger was charged with bribery of $976,630 for a Goa water developmental project. Bribes were even made to a minister, the details of which have not been disclosed by the Department of Justice.
On Friday, the company agreed to pay $17.1 million criminal fine to resolve charges that it bribed officials in India, Indonesia, Vietnam and Kuwait to secure government construction management contracts.
Two of its former executives - Richard Hirsch (61) of Philippines, and James McClung (59) of the UAE - pleaded guilty to the bribery charges.
The sentencing hearings for Hirsch and McClung are scheduled for 5 November.
"Along with several consortium partners, the company won two water development projects in Goa and Guwahati. The company paid bribes to win both of these contracts," federal prosecutors alleged.
Where it all began
The Indian government, assisted by Japanese government, initiated the five-year Goa Water Supply and Sewerage Project to expand, rehabilitate and build water and sewerage facilities.
Louis Berger was part of a consortium for the project in Goa. The consortium included two Japanese firms and an Indian partner.
The team developed a project management information system and plan, evaluated bids, reviewed design and construction plans, and ensured quality work was done on time and within budget, the company says on its website.
Federal prosecutors, in their 11-page chargesheet, alleged that Louis Berger maintained a detailed diary and account of bribery made to Indian officials.
On 26 August 2010, "a consortium partner prepared a payment tracking schedule stating that the company had paid $976,630 dollars in bribes in connection with the Goa Project to date", federal prosecutors told a court in New Jersey.
On 17 August 2010, a consortium partner sent an e-mail to James McClung, stating, "As discussed I enclose the details as provided by [third-party intermediary]. I have also added the details of amounts paid to [the Company] as of date by [the consortium partner] in the same sheet."
The attachment included an entry, "Paid by [an agent of the company] to minister on behalf of agent," said federal prosecutors.
According to court documents, the company through its employees and agents, together with others, used terms like "commitment fee," "counterpart per diem," "marketing fee" and "field operations expenses" as code words to conceal the true nature of the bribe payments and utilised cash disbursement forms and invoices which did not truthfully describe the services provided of the purpose of the payment.
Goa Chief Minister Laxmikant Parsekar on Sunday said he will demand a CBI inquiry into the allegations. Former chief minister Manohar Parrikar has hinted that more than one minister can be involved in the case.
"Since it is an international matter, Goa police can't investigate it. That is why the government has decided to write to Prime Minister and Union Home Minister demanding a CBI inquiry into it. Truth should be revealed to the people," the Chief Minister told reporters in Panaji on Sunday morning.
Indian ministers involved
"When the contracts were awarded, Congress leader Digambar Kamat was the Chief Minister and Churchill Alemao was Public Works Department Minister. Now it should be revealed which minister took the bribe," Parsekar said.
"The project was related to Japan International Cooperation Agency. Therefore, the then PWD minister may be involved; and since the project also deals with financial approval, there is likelihood of another minister's involvement," Parrikar said while addressing a meeting of party workers in Margao.
PWD minister during the Congress government, Churchill Alemao has refused to comment on the allegations, saying he has "no idea what statement the media is quoting".
With inputs from PTI
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