Corruption charges against SNC-Lavalin are being used "mercilessly" by its competitors, resulting in missed work totalling "probably in excess of C$5 billion" so far, the company’s chief executive has said.
(Rivals are) constantly, constantly using this against us, even though as a company we have not been found guilty of anything– Neil Bruce, SNC-Lavalin
Speaking to BNN Bloomberg TV, Neil Bruce said the firm has lost out on contracts because clients are wary, even though the company has been transformed and the charges haven’t been proved.
He used the interview to criticise again the refusal of Canadian prosecutors to negotiate an out-of-court settlement on its case, even though a new regime has recently been established for that purpose.
"It weakens our position as a business because our competition basically use this mercilessly against us, and have been doing so for the past six years," Bruce said yesterday, Bloomberg reports. "We know that we’ve lost out on a number of contracts, probably in excess of C$5 billion, because clients in the end will not take the chance on picking SNC-Lavalin."
Rivals in Europe and the US are "constantly, constantly using this against us, even though as a company we have not been found guilty of anything," the CEO said. "These are still charges."
Shares in Canada’s biggest construction company fell steeply in October when it revealed that federal prosecutors had ruled out a so-called a remediation deal over charges laid in 2015 in relation to its dealings in Libya.
That year, following a three-year investigation, police laid charges against the SNC-Lavalin Group and two subsidiaries, alleging that between 2001 and 2011 the company offered millions of dollars in bribes, and defrauded Libyan officials of millions more.
Three former company executives had previously been charged with corruption, including former chief executive Pierre Duhaime, whose trial is scheduled to start early next year.
The company argues that it underwent root-and-branch reform starting from when the scandal blew up in late 2012, and that it is now a completely different company.
It wants its case handled under Canada’s new Remediation Agreement regime, which came into effect in September this year, allowing companies to avoid prosecution in return for admitting wrongdoing, paying fines, and implementing reform measures.
In its campaign to avoid a lengthy trial, SNC-Lavalin even appealed to the court of public opinion, paying for "An open letter to Canadians" in four of the country’s most influential newspapers on 19 October.Â Â
In it, Bruce apologised for "shortcomings" in the years before 2012, insisted SNC-Lavalin had reformed, and warned that a trial and conviction would hurt the company’s employees, customers, pensioners "and other innocent stakeholders who did nothing wrong".
Bruce used this week’s Bloomberg interview to press again for the Public Prosecution Service of Canada to open negotiations for a Remediation Agreement.
"We are puzzled and really unsure as to why we are not in a position to settle," he said. "What we are frustrated by is the lack of engagement, and the lack of information as to why not."
He added: "The company has self-remediated in so many different ways. We’ve changed the board, we’ve changed the management. All of the alleged bad actors have all left the business."
Last week, the new premier of Quebec, Francois Legault, said it was ready to protect SNC-Lavalin from a hostile takeover after the company’s share fall.Â
In response, Bruce said a takeover was unlikely because of both its size, and the legal challenges.
"I think it’s pretty difficult because ultimately we’re a big company," Bruce told Bloomberg. "Plus we’ve got a huge Canadian shareholding, more than 80%. Ultimately anybody who looked at this would have to have a plan to solve the issues that we’re having difficulty solving."
Image courtesy of Jeangagnon/CC BY-SA 3.0