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Construction Firm’s Foreign Ties Probed

Monday, April 16, 2012

More items for Program/Project Management

Canadian authorities are investigating one of the world’s largest engineering and construction groups, which has extensive operations in Libya.

SNC-Lavalin

The company’s vast global project portfolio includes engineering, procurement, construction, startup and commissioning of the Panda Gila River Power Station, the largest natural gas-fired plant in North America.

The Royal Canadian Mounted Police executed a search warrant Friday (April 13) at the head office of SNC-Lavalin in Montreal.  Employees were told by email to evacuate the building, and some said the search was concentrated on a floor with executive offices, The New York Times reported.

“The warrant relates to an investigation of certain individuals who are not or are no longer employed by the Company,” the company said in a brief statement.

CEO Resigns; Payments Questioned

Last month, SNC-Lavalin CEO Pierre Duhaime resigned after an internal audit found that he had authorized $56 million Canadian ($55.8 million US) in unauthorized payments to unidentified agents. The company says it does not know the purpose of the payments.

In February, SNC-Lavalin fired the head of its construction unit and Stéphane Roy, a senior financial executive in that unit, saying they had violated the “code of ethics and business conduct.”

Roy had hired Cynthia Vanier, a Canadian consultant, to travel to Libya, where the company was building a prison and other projects, “to produce a five-page report that was critical of the NATO-led bombing campaign in support of Libyan rebels,” The New York Times reported.

In November, the newspaper said, Vanier was arrested in Mexico on allegations that she was involved in a plot to smuggle Saadi el-Qaddafi, the former Libyan dictator’s son, into Mexico. She denies the allegations and remains jailed.

Bidding Ban

On April 2, the company announced that it had been temporarily suspended from bidding on any new projects dinanced by the World Bank following an investigation by that agency into “unspecified allegations about bidding on a bridge project in Bangladesh.”

The company had bid unsuccessfully “to act as the Owner's Engineer for the Bangladesh government in supervising the Contractor responsible for the overall bridge construction project,” SNC-Lavalin said.

SNC-Lavalin is one of the world's largest engineering, procurement, construction and related technical services organizations, serving the infrastructure, mining, power, chemical and other industries in scores of countries worldwide.