NHAI Orders Probe As U.S. Firm Admits To Paying $1.1-Million Bribes
U.S. firm admits to paying $1.18 million in bribes to NHAI officials.
The National Highway Authority of India has started investigating alleged payment of bribes to its officials by U.S. firm CDM Smith.
This comes after a probe by the U.S. Department of Justice revealed that the U.S. firm had paid bribes worth $1.18 million to NHAI officials through Indian subcontractors between 2011 and 2015.
“In view of the seriousness of the charges, the NHAI has initiated an internal investigation into alleged payment of bribe money to its officials as reported in the media,” the NHAI said in a statement.
The Criminal Division of the Justice Department, in a letter dated June 29, said CDM Smith through its employees and agents bribed government officials in India in exchange for highway construction supervision and design contracts and a water project contract in Goa.
The bribes generally were 2-4 percent of the contract price and paid through fraudulent subcontractors, who provided no actual services and understood that payments were meant to solely benefit the officials.Letter From United States Department of Justice
The resulting net profit from the illegal conduct was more than $4 million, which the company now has to pay the U.S. Treasury Department. CDN Smith was also barred for three months in 2015 by the NHAI because of deficiency in services in one of the projects, Dholpur-Morena Section of the National Highway-3.
Road Transport and Highways Minister Nitin Gadkari has taken a serious note of the allegations and asked the NHAI Chairman to hold an inquiry into the matter, a senior ministry official told BloombergQuint.
The NHAI said that it doesn’t have any ongoing projects with CDM Smith.