* Quebec anti-corruption squad issues warrants for former
* Charges stem from Quebec probe into public works contracts
* Ex-CEO to plead "not guilty" to charges, lawyer says
By Louise Egan and Susan Taylor
OTTAWA, Feb 27 The former chief executive of
SNC-Lavalin Group Inc, a Canadian construction and
engineering company caught in a far-reaching misconduct scandal,
faces six new fraud-related charges, police said on Wednesday
after issuing a warrant for his arrest.
The province of Quebec's anti-corruption police unit alleges
that ex-CEO Pierre Duhaime, who resigned from the Montreal-based
company last year, committed fraud and other criminal offenses.
In a statement, the unit provided no details about the
charges, but the Globe and Mail newspaper reported they were
connected to a contract awarded to SNC in 2010 for the
construction of a Montreal hospital.
An arrest warrant was also issued on Wednesday for Riadh Ben
Aissa, SNC's former head of construction, for similar corruption
charges, as well as for three other men.
The allegations are the latest development in a widening
scandal at SNC that stretches from Montreal to Tripoli and led
to prior arrests of both Duhaime and Ben Aissa.
"In the cases of Pierre Duhaime and Riadh Ben Aissa, these
are new criminal accusations which have been authorized by the
bureau for the fight against corruption and embezzlement," said
the anti-corruption unit in a statement.
In early 2012, an internal investigation by SNC found that
$56 million in funds had gone missing, paid to unknown agents on
projects that did not exist. Duhaime quit in March after it came
to light that he signed off on the mystery payments.
He was then arrested in November on three fraud charges and
Ben Aissa was arrested in Switzerland last April on charges
of money laundering and corruption and in an affidavit released
last month, Canadian police alleged that he had paid bribes to a
son of deposed Libyan leader Muammar Gaddafi in exchange for
help in obtaining major contracts for the company's
international arm. He remains in custody in
SNC AWARE OF WARRANTS
Duhaime's lawyer Michel Massicotte told Reuters on Wednesday
that his client had not yet been arrested and that he would
plead "not guilty" to the new set of charges, which he said
would replace previous ones.
"He's in the province of Quebec and obviously he will face
the charges there. There's no problem about that," Massicotte
Lawyers representing Ben Aissa were not immediately
available for comment.
SNC said it was aware of the warrants for its former
executives and that it would continue to cooperate fully with
"We have voluntarily turned over information that we have to
local and other authorities for them to take any actions that
they may consider appropriate," spokeswoman Lilly Nguyen said in
"We are unequivocal that no unethical behavior or illegal
acts must ever be tolerated. We believe that anyone found to
have committed any wrongdoing in connection should be brought to
The 102-year-old company has installed a new CEO and several
new executives while tightening its ethics policies.
Last week, it hired a former Siemens AG compliance officer
to help guide it through the scandal. Siemens
paid $1.6 billion to U.S. and European authorities in 2008 to
resolve allegations it paid bribes around the world.
Investors appeared to shrug off the news, though modest
gains were erased by session-end on Wednesday, as the stock
closed down 4 Canadian cents at C$47.13 on the Toronto Stock
"Right now there is, incrementally speaking, nothing new at
all, so that's why the market just doesn't care," said Maxim
Sytchev, analyst at AltaCorp Capital.
Also named in Wednesday's arrest warrant was Arthur Porter,
the former head of the McGill University Health Centre, which
runs a network of health facilities. The Globe and Mail
newspaper reported Porter was the chief negotiator on the C$1.3
billion ($1.3 billion) contract awarded to SNC in 2010.
Porter's alleged involvement in corruption has ruffled
feathers in political circles because Prime Minister Stephen
Harper had appointed Porter in 2008 to a committee which
oversees the government's spy agency, where he served until