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Bombardier, Garuda investigated for corruption

The United Kingdom’s Serious Fraud Office (SFO) announced that it has begun an investigation regarding Bombardier and the flag carrier of Indonesia, Garuda Indonesia.

The SFO disclosed that it is currently in an active investigation “over suspected bribery and corruption in relation to contracts and / or orders from Garuda Indonesia,” read the office’s statement.

“As this is a live investigation, the SFO can provide no further comment,” was added to the short statement.

The Indonesia-based Garuda currently operates 18 Bombardier CRJ-1000 regional jets. The deal to acquire the aircraft was completed during the Singapore Airshow in February 2012, where the flag carrier initially agreed to acquire six CRJ-1000 aircraft, with the option to take delivery of 12 additional jets. The deal was valued at $1.32 billion at list prices, read Bombardier’s announcement at that time.

Garuda Indonesia took delivery of its first Canada-built regional jet in October 2012. Bombardier delivered the final CRJ1000 to the airline in December 2015.

“The Bombardier CRJ1000 NextGen airliner’s superior economics, outstanding fuel economy and excellent passenger comfort ideally meet our requirement for 100- seat aircraft to service domestic and regional markets from five regional hubs,” stated the now-jailed chief executive officer of Garuda Indonesia Emirsyah Satar in February 2012.

In May 2020, Satar was jailed in Indonesia for bribery and money laundering charges related to purchases of aircraft from Airbus and engines from Rolls-Royce. In addition to an eight-year sentence, the former executive was also fined IDR2 million ($1.4 million).

According to Bombardier’s Q3 2020 financial results, published on November 5, 2020, the company indicated that “no charges were laid against the Corporation or any of its directors, officers or employees.” The company has launched an internal investigation into the matter, which is conducted by an external counsel.

“The Corporation has met with the SFO to discuss the status of the Corporation’s internal review and its potential assistance with the SFO investigation on a voluntary basis,” added Bombardier regarding the matter.

 

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