Fined US group will not discuss Irish arm

US industrial group Ingersoll-Rand has declined to say whether it disciplined any of its Irish staff after US regulators found that one of its main units in Ireland paid an illegal "kickback" to Saddam Hussein's regime in Iraq. Arthur Beesley, Senior Business Correspondent, reports.

Ingersoll-Rand must pay fines of $6.7 million (€4.6 million) to settle claims on foot of a court action by the US Securities & Exchange Commission (SEC), which found that four of its international subsidiaries paid bribes totalling $963,000 to win business from the Iraqi government under the UN oil-for-food programme in 2000-2003.

One of the firms implicated in the affair was Thermo-King Europe, a Galway-based Ingersoll-Rand subsidiary which is engaged in the transport temperature control business. This company is alleged to have made an illegal payment of almost $54,000 to an Iraqi government company.

Without naming any individual company officials, the SEC claimed that Thermo-King Europe's regional director and its Iraqi dealer arrived in Baghdad in October 2000 to finalise a contract for the sale of spare parts for refrigerated trucks to General Automobile & Machinery Trading, a firm controlled by Saddam Hussein's government.

"At the meeting, the regional director signed a side agreement to make an after-sales service fee payment of $53,919. The after-sales service fee payment obligation was not reflected in the contract documents submitted to the UN," the SEC said. "The contract, however, failed to receive UN approval for reasons unrelated to the sales service fee payment."

Paul Dickard, the chief spokesman for Ingersoll-Rand, said he was not at liberty to say whether any staff based in Ireland were implicated in a kickback payment or whether any staff working in the Irish unit were disciplined as a result of the proceedings against the group.

While fine payments to the SEC and the US department of justice will enable Ingersoll-Rand to avoid criminal prosecution and settle civil claims, the group said this week that "certain individuals who were involved with this matter have been terminated".

The group's operation in Ireland is lucrative. The latest available accounts for for its main holding company here - Ingersoll-Rand Irish Holdings - show that it made profits of €87.08 million in 2005 and paid a €140 million dividend to its parent.