The long-simmering Securency scandal erupted this week, with arrests in the U.K., and searches of houses and businesses in England, Spain, and Australia.
The U.K.’s Serious Fraud Office said Wednesday 80 members of its office, plus officers in Surrey, Hampshire, Thames Valley, Cumbria, and the Metropolitan police services executed search warrants at eight residences and a business in the UK. There were two arrests, the SFO said.
Two search warrants were also executed in Spain by authorities there in relation to three British nationals. And six search warrants were executed on residences in Australia.
Australian federal police have been investigating allegations about Securency, the polymer banknote-maker half owned by the Reserve Bank of Australia. It may have paid bribes and offered favors to win contracts in Asia, Africa and Latin America.
The Sydney Morning Herald said today the business searched in the U.K was Innovia Films. It’s the Australian Reserve Bank’s joint-venture partner in Securency. The two Britons arrested were not charged after the raids, the paper said.
The Spanish raids were linked to several of Securency’s agents who worked in Africa, including a British husband and wife who live in Spain.
Earlier this year, we heard from sources with knowledge of the Australian investigation that a small group from the Australian federal police had met in Washington, D.C. with the DOJ’s FCPA team. Australian police were also reported to be working directly with the Malaysian Anti-Corruption Commission on the Securency investigation.
In November 2009, Securency’s board launched an investigation. It also fired or suspended the managing director and the company secretary, and ended marketing activities involving agents. According to the company’s board, an audit showed that agents were paid almost $50 million in commissions since 2003.
Securency manufactures a proprietary polymer substrate used in Australian banknotes and banknotes issued in 27 other countries.