The Italian conglomerate Finmeccanica is currently the focus of two bribery scandals associated with sales deals, including a deal in Panama where a principal of the Mossack Fonseca law firm is involved.
In October 2014 an Italian court cleared the chief executive of Finmeccanica, Giuseppe Orsi, of charges of "international corruption", but convicted him and associate Bruno Spagnolini of lesser charges relating to false invoices. The convictions are being appealed.
The charges arose from allegations of bribery in relation to signing of a contract for the sale of 12 AgustaWestland helicopters to the Indian government.
Related charges against Finmeccanica were dropped and AgustaWestland, a British-Italian joint venture involving Finmeccanica, paid an €8 million fine while reiterating it knew nothing about the alleged bribery.
It was alleged that tens of millions of dollars in bribes were paid to Indian officials, and that the money was routed through a series of jurisdictions and companies and was linked to the false invoices. Orsi was head of AgustaWestland at the time.
In January 2014, the Indian government said it was pulling out of the €560 million deal, which had been signed four years earlier, because of the bribery scandal. The parties alleged to have received bribes in India denied the allegations.
Investigations in India continue. After he was cleared of the more serious charges, Orsi said the bribery allegations had been “concocted by adversaries within Finmeccanica”.
The Italian conglomerate is also involved in an ongoing controversy in Panama. The scandal involves a $250 million contract Panama signed with Finmeccanica in 2010 to supply helicopters, radars and a digital mapping system to the Central American country.
The agreement was championed by then Panamanian president Ricardo Martinelli and then Italian prime minister Silvio Berlusconi. At the time, Ramon Fonseca, one of the two principals of the Mossack Fonseca law group, was an advisor to Martinelli.
Investigations in Italy began to raise questions about the Panamanian deal with allegations emerging of ties between an Italian businessman, Valter Lavitola, Berlusconi, and Martinelli. Lavitola is currently facing charges in relation to the deal, as is former Finmeccanica director, Paolo Pozzessere.
(One of the leaked sales promotions agreements signed by the Irish company Intertrade Projects Consultants said that all communications in relation to the deal, which involved sale of G.222 military transport aircraft to the Ministry of Defence in the Philippines, should in future go to Pozzessere. The 2004 agreement said a success fee of 8 per cent would be paid for any sales achieved.)
The scandal in Panama involved a shell company named Agafia whose beneficial owners are alleged to have included Martinelli. The company was to receive $25 million, or 10 per cent, in commission arising from the sale.
Lavitola was to receive a participation in Agafia for his part in landing the deal, according to the allegations. The money was never paid as the controversy began before the deal was completed.
While some figures in Panama are facing charges in relation to the deal, Martinelli is not. However, he is currently facing other corruption charges, and is believed to be living in Miami, Florida.
Pozzessere told an Italian court that Agafia acted as a consultant to the deal and that it was normal to pay commissions of 7 to 15 per cent for deals in Central America.
Lavitola told the court that Agafia was an agent of Finmeccanica’s in Panama. The prosecution has cited recorded telephone conversations where Lavitola allegedly told Pozzessere that Martinelli had a stake in the company.
Last year, Panama initiated a lawsuit in its Supreme Court seeking to cancel the controversial contracts, citing corruption concerns. Earlier this year Finmeccanica agreed to the cancellation of the contract.
Under the settlement, Finmeccanica agreed to supply Panama with an AgustaWestland helicopter free of charge, while Panama committed to withdraw its case in the Supreme Court and to re-launch business relationships with the Italian defence and aerospace group “in a spirit of renewed trust”.
The two sides have also pledged to co-operate with criminal inquiries under way in both jurisdictions.