Rolls-Royce says sorry after corruption probe results in record fine

Rolls-Royce has offered an "unreserved apology" after agreeing to pay more than £600m to settle a long-running corruption case.

The engineering company, one of the best known names in British business, admitted that its behaviour had been "unacceptable" after an investigation showed its involvement in bribery and false accounting.

A deal with British authorities has now been ratified, allowing Rolls-Royce to escape further criminal prosecution in return for paying a penalty of £497m.

It will also pay around £141m to the Department of Justice (DoJ) in America, a deal that is being rushed through in order to be completed before the inauguration of Donald Trump as President and a further penalty in Brazil.

The deal, known as a Deferred Prosecution Agreement, will also mean Rolls-Royce agreeing to further scrutiny, and will see the company continue to provide access to documents.

Criminal prosecutions are now being considered against individuals involved in the corruption - though these will be weighed up over coming months rather than weeks, the SFO's director David Green said.

Mr Green told Sky News: "We will now turn our attention and our priorities to individual suspects and apply the code test for crown prosecutors for them.

"We will make proper decisions about whether anybody should be prosecuted."

The details of Rolls-Royce's deceit were unveiled in court, with a network of bribes going back a quarter of a century in seven countries.

Intermediaries in Thailand were paid around $36m to secure three deals for Rolls-Royce to supply engines to Thai Airways (Stuttgart: 834644.SG - news) .

In Indonesia, the company paid someone $2.25m and a Rolls-Royce car to "show favour" for using Trent (BSE: 500251.BO - news) 700 engines when choosing engines for the state airline, Garuda.

And so it went on - backhanders were offered in Russia, Nigeria, China. Malaysia and India, with Rolls-Royce either initiating the bribes or failing to stop it happening.

Separately, US authorities also detailed corruption in Brazil, Kazakhstan, Azerbaijan, Angola and Iraq.

DoJ fraud chief Andrew Weissmann said: "For more than a decade, Rolls-Royce repeatedly resorted to bribes to secure contracts and get a competitive edge in countries throughout the world."

In 2012, the SFO raised the alarm after being alerted to some of the activity – prompting a probe by the company, which then passed on evidence of corruption.

So began a four-year inquiry that was to prove the most expensive single investigation in the SFO's history.

More than 30 million documents were examined.

The terms of this agreement were approved by Sir Brian Leveson at the High Court, who said Rolls-Royce had offered "a high level of co-operation", and said the allegations had involved "a totally different top layer" of management.

Rolls-Royce, in turn, maintained it has undergone a profound cultural change, replacing its entire senior management.

Sir John Rose stood down as chief executive in 2011, after 15 years at the top of the company.

Chief (Taiwan OTC: 3345.TWO - news) executive Warren East: "The behaviour uncovered in the course of the investigations by the Serious Fraud Office and other authorities is completely unacceptable and we apologise unreservedly for it."

Shares (Berlin: DI6.BE - news) rose 4% after the agreement which meant the SFO suspended an indictment that would have seen Rolls-Royce face 12 counts of conspiracy to corrupt, false accounting and failure to prevent bribery.