Bombardier, a company that produces aircraft and train equipment and is headquartered in Montréal, Canada is under scrutiny after one of its sales executives in the Sweden office was arrested.
In 2013, the Stockholm-based train division of Bombardier won a $350 million contract to supply Azerbaijan with an interlocking system for railway switches and signals. They sold the equipment to a UK intermediary, Multiserv Overseas, which then [sold] the identical equipment back to Bombardier’s Azerbaijan affiliate for an inflated price. Export records showed deliveries of the equipment directly from Bombardier Sweden to Azerbaijan and not to Multiserv. Multiserv made a profit of $85.8 million in the deal, the Organized Crime and Corruption Reporting Project (OCCRP) said.
Swedish anti-corruption prosecutor Thomas Forsberg told the OCCRP that Multiserv Overseas has “no employees or business.” However, a Bombardier Sweden spokesperson, Barbara Grimm, told the OCCRP that Multiserv Overseas “is a bona fide company, we have done due diligence with them. They meet our code of ethics.”
This is one example illustrating the importance of Compliance Officers and companies doing their due diligence and maintaining records. How is it possible for the Bombardier spokesperson to claim they did their due diligence and the company to which they sold the equipment “met their code of ethics”, however, upon further investigation, it turns out that the company has no employees or business and is effectively a shell company?