UPDATE 3-SNC-Lavalin ex-CEO arrested in widening scandal

Wed Nov 28, 2012 5:27pm EST
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* Quebec police say Pierre Duhaime arrested

* Duhaime resigned from SNC in March

* SNC shares close down 2 pct on Toronto Stock Exchange

* Another former SNC exec charged in Switzerland (Adds comment from Duhaime's lawyer, fund manager comment, closing stock price)

By Nicole Mordant

Nov 28 (Reuters) - In the latest twist in an ethics scandal at Canada's biggest engineering firm, the former chief executive of SNC-Lavalin Group was arrested on Wednesday on three fraud-related charges, sending the company's stock down 2 percent.

Pierre Duhaime, who resigned from SNC in March, was arrested at his home by the province of Quebec's anti-corruption squad on charges of fraud, conspiracy to commit fraud and use of false documents, said Anne-Frédérick Laurence, a spokeswoman for Unite Permanente Anticorruption Quebec, a provincial police unit.

"He was arrested this morning and he will be able to go with a promise to collaborate," she said by telephone from Montreal, the largest city in the mainly French-speaking province.

Laurence would not comment further on the nature of the charges.   Continued...