Last week, the UK’s Serious Fraud Office (SFO) announced a criminal investigation into allegations of fraud, bribery, and corruption related to Airbus’ civil aviation business.
According to the short statement by the SFO:
These allegations relate to irregularities concerning third party consultants.
Back in April, the UK suspended Airbus for “lack of transparency with third-party payments” (Source: FCPA Blog). Germany and France followed suit by suspending their export-credit guarantee to Airbus, which is essentially an insurance policy for exporters (Airbus) in the case each particular country’s importers do not pay invoices. Sometimes, these guarantees are required in a financing deal.
How many airplanes could be affected by this slowdown? Less than 10%.
There’s no word on if the new allegations are related to the April report.
With respect to the new developments, I can’t comment on any facts in the case as I’m not privy to the information, but I can opine on the situation.
Most companies utilize “third party consultants” as a part of everyday business. It’s usually best practice to be completely transparent about the payments to those consultants and their relation to the business.
Oftentimes – and this is where companies get into trouble – you’ll see a situation where a firm offers some sort of compensation to “consultants” or government officials in exchange for a contract or new work. This is prohibited in many countries.
With such little detail on the allegations it’s tough to, and not wise to, speculate on the matter. However, I feel it’s an important story to share as it could have a direct impact on airline scheduling if this pans out into something larger. It could delay aircraft deliveries, force equipment swaps, etc.
As this is all speculation, I’ll be sure to keep you updated if/when new details emerge.
The UK’s Serious Fraud Office asks anyone with information on the Airbus investigation, click here.
Author’s Note: I am a Certified Fraud Examiner (CFE) and am offering my opinion on this matter purely on my own will. None of my views expressed in this post or on BoardingArea represent the views of my employer or of the Association of Certified Fraud Examiners.