Montreal-based engineering giant SNC-Lavalin announced on Tuesday it will reimburse the Quebec government for funds obtained illicitly.
The company announced it is participating in the Quebec government’s Voluntary Repayment Program put into place last year. The program allows companies to reimburse the government or any public body within the province for funds obtained illicitly, or for overpayment — as a way to get payment without having to resort to a lawsuit.
The program allows companies to make voluntary payments to the government, government bodies or municipalities for funds obtained illicitly in the past 20 years. Hundreds of letters have been sent out to companies asking for funds. The city of Montreal, for example, sent out 380 warning letters to companies. If they don’t participate, the city says it will use its legal recourse to recover the money it believes it overpaid.
SNC-Lavalin (TSX:SNC) spokesperson Louis-Antoine Paquin said the company will reimburse Montreal, Quebec City, Laval, Lévis, and the small village of St-Cyprien, near Rivière-du-Loup.
The company did not detail how much money it would pay back, but Paquin said proposals will be submitted in the coming days.
Under the terms of the repayment program, companies have until Nov. 1 to signal their intention to take part in the program. Thirty days after that, they must present a reimbursement plan to the public body or bodies that overpaid.
The program’s administrators will then verify all the details of each proposal and, within the next 150 days, give its recommendation to Quebec’s justice minister. The minister then has 30 days to submit the repayment plan to the affected public bodies.
They then have 60 days to advise the minister if they approve or disapprove of the plan. The public body must hold a vote on it within 210 days of receiving the proposal.
If the proposal is refused, the administrators have 30 days to convene a conciliation meeting between the parties.
Paquin said SNC-Lavalin wants to resolve all its outstanding issues with public bodies at once. That’s why the company is opting for the program’s stipulation that allows any public body that feels it has overpaid for fraudulent purposes, to submit proof to the Quebec government in the next 60 days.
In addition to dealings with the government of Quebec, SNC-Lavalin is also facing criminal charges in its dealings with the Libyan government. The RCMP has alleged the company paid nearly $47.7 million to public officials in Libya between 2001 and 2011 to influence government decisions.
It has also charged the company, its construction division and its SNC-Lavalin International subsidiary with one charge each of fraud and one of corruption for allegedly defrauding various Libyan organizations of about $129.8 million. In February 2014, the Mounties also charged former executive vice-president Sami Bebawi with fraud over $5,000; two counts of laundering proceeds of crime; four counts of possession of property obtained by crime, and with bribing a foreign public official. In September 2014, the RCMP added obstructing justice to the list of charges.
A preliminary hearing is set for September 2018. SNC-Lavalin has said it wants Canada to adopt so-called deferred prosecution agreements that would allow companies to settle corporate corruption cases by paying a fine, rather than going through a lengthy court proceeding. It would also avoid companies being put at a disadvantage when competing against rival firms in other G7 countries.
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