Canada police lay charges against SNC-Lavalin, stock drops
By Euan Rocha
TORONTO (Reuters) - Canadian police laid corruption charges against SNC-Lavalin Group Inc (SNC.TO: Quote) on Thursday, the first time the engineering company has been directly charged with alleged bribery as it conducted business in Libya over a ten-year period until 2011.
Montreal-based SNC said it would plead not guilty and urged that individuals, and not the company itself, be charged.
Still, the company's stock fell more than 8 percent on fears about how a conviction would affect its business, as strict new anti-corruption legislation in Canada potentially bars companies convicted of crimes from doing business with the government.
Scandals involving alleged corruption and bribery at SNC's Libyan operations emerged three years ago and led to the ouster of SNC's former chief executive, Pierre Duhaime, in 2012, after the discovery of millions in missing funds. Other former SNC executives, too, stand accused of fraud and criminal offenses by law enforcement authorities in different countries.
The Royal Canadian Mounted Police charged SNC and two units Thursday with offering C$47.7 million ($38.2 million) in bribes to Libyan officials between 2001 and 2011 and of defrauding Libya of C$129.8 million.
SNC Chief Executive Robert Card responded in a statement, saying the charges, which were publicly known, were without merit, and "the company has cooperated with authorities."
Card had previously said any move by authorities to charge the company would threaten its future because it could lose out on crucial government contracts.
RBC Capital said in a note SNC could face challenges in future bidding in Canada and abroad if found guilty. Continued...