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Harry Cassin
Publisher and Editor

Andy Spalding
Senior Editor

Jessica Tillipman
Senior Editor

Bill Steinman
Senior Editor

Richard L. Cassin
Editor at Large

Elizabeth K. Spahn
Editor Emeritus

Cody Worthington
Contributing Editor

Julie DiMauro
Contributing Editor

Thomas Fox
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Marc Alain Bohn
Contributing Editor

Bill Waite
Contributing Editor

Shruti J. Shah
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Russell A. Stamets
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Richard Bistrong
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Eric Carlson
Contributing Editor

Airbus graft probe spreads to United States

Airbus Group SE, already under investigation in the UK and France for suspected corruption, said in a company release Tuesday that it found “inaccuracies in filings” made with the U.S. Department of State under the International Traffic in Arms Regulations.

The Toulouse, France-based aircraft maker said it disclosed the inaccuracies to “U.S. authorities.” Airbus didn’t say which U.S. authorities it talked to but said it is cooperating.

The International Traffic in Arms Regulations include requirements for exporters to disclose to the State Department payments to third-party intermediaries for certain overseas sales.

Last year the UK Serious Fraud Office confirmed that it had opened an investigation into Airbus Group for criminal fraud, bribery, and corruption.

The SFO said “the allegations relate to irregularities concerning third party consultants.”

In April 2016, the UK Export Finance agency suspended funding for Airbus because of a lack of transparency with third-party payments. France and Germany also suspended export funding.

In 2016, Airbus Group generated revenues of €67 billion ($78 billion) with a workforce of around 134,000.

In March this year, Airbus said French investigators had  also opened a preliminary investigation. France’s financial crimes investigator — the Parquet National Financier — is examining the same allegations under review by the SFO.

Violations of the International Traffic in Arms Regulations or ITAR were part of the 2010 FCPA-related enforcement action against UK-based BAE Systems.

BAE — one of the biggest military contractors to the U.S. government — paid the DOJ a $400 million criminal fine.

BAE pleaded guilty to a conspiracy that involved impeding U.S. investigators, making false statements about its FCPA compliance program, and violating the Arms Export Control Act and ITAR

At the same time, the SFO fined BAE £30 million ($40 million) in a negotiated resolution.

A year later the U.S. State Department fined BAE $79 million for violations of the Arms Export Control Act and ITAR. It was the biggest penalty the State Department had ever imposed.

The State Department said that despite assurances, BAE “made a series of substantial payments to shell companies and third party intermediaries” without due diligence or proper corporate controls.

Some of the payments went to “marketing advisors” whose identity BAE actively concealed from the U.S. government. BAE also kept secret some of the payments to intermediaries.

The State Department didn’t debar BAE and settled the civil case without going to court.

Airbus didn’t give any details Tuesday about the type of “inaccuracies” it found in its ITAR filings.


Richard L. Cassin is the publisher and editor of the FCPA Blog.

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