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Journalism of Courage
A year before Italian helicopter manufacturer AgustaWestland invited Indian authorities to examine its books in connection with the VVIP helicopter contract with India,international audit firm PriceWaterhouseCoopers PwC had already done that and noted irregularities in the contract,it has emerged.
PwC had got into the picture after the UK subsidiary of the helicopter manufacturer insisted on it,following reports of the investigation into corruption charges. Going through AgustaWestlands accounts,the audit firm found several irregularities in the companys contracts with alleged middleman Christian Michel. It had wanted an external law firm hired for an investigation.
As reported earlier,Michel bagged 30 million euros from two controversial contracts with the company in 2010,one for managing hostile media in India and the other for buying back faulty WG 30 helicopters from Pawan Hans as a goodwill gesture to New Delhi.
Documents accessed by The Indian Express reveal that Italian investigators believe that the company did hire an external lawyer for a deep audit into the Michel link,but that he was replaced with another expert as the report he gave had a different line from the one that the management had hoped for.
PwC found irregularities in AgustaWestland contracts and wanted deep investigations,to be done with experts external to the company, Italian investigators have noted in an internal inquiry report,adding that arrested CEO Orsi had excessive power and imposed unjust guidelines for internal audits to hide any signs of irregularities.
While the helicopter company repeatedly told the Indian government that no evidence of wrongdoing had been found in several internal checks and has assured that the records are clean,Italian investigators believe the firm deliberately buried a report by the external law agency that pointed to underhand dealings.
Because of the insistence of PwC on hiring an external lawyer,the company roped in international corruption expert Eoin OShea to examine the contract as well as the dealings with Michel. However,the expert,investigators believe,was replaced as his report on the Michel link raised uncomfortable questions.
It is evident that lawyer OShea in his report must have given a different line from the one that the management had hoped for and was therefore replaced, investigators have noted,adding that the financial director of AgustaWestland,Biganzoli Sergio,was against an external check,making the argument that if you reopen the balance sheets it means admitting we have some faults.
The documents accessed by The Indian Express reveal also that the internal auditors of AgustaWestland refused to travel to Dubai and examine the Michel link,fearing that they would be hauled up at a later stage in Italian courts and made to testify on the matter. The contracts for monitoring the Indian media worth 6 million euros and to buy back 15 WG 30 choppers from Pawan Hans,were both inked with Michels Dubai-based firms.
Investigators have uncovered evidence that the audit head of AgustaWestland,Giorgio Casana,had refused to travel to Dubai in March 2012,expressing reservations about the deal with Michel,and that he had even raised the matter with Graham Cole,the chairman of AgustaWestland Ltd,the UK subsidiary of the company.
In a phone conversation recorded by investigators on 3 March 2012,senior functionaries of the firm discuss how Casana refused to go to Dubai as he was afraid that he would be hauled up before judges in Italy as part of the investigations into the corruption charges. Excerpts from a conversation between financial director Sergio and company executive Digennaro Francesco:
Sergio: I tell you one thing,Graham cannot remain uninformed of what is happening,otherwise it is a mess. Now he is very angry8230; He is very angry and says he was surprised,being the chairman,for all this situation because he is in UK,he is the chairman,Bruno Spagnolini gave him the task of handling the thing.
Franceso: No,no.
Sergio: Now listen,he is angry because he found out that yesterday Casana will no longer go to Dubai and Casana told him,in presence of the internal lawyer,that he wont go because if he finds out something then he will have to say it to the Italian magistrate.
Franceso: No,no.
Sergio: Oh,ditto what he just told me,Casana told me this too.
As reported by The Indian Express,the contracts with Dubai-based Michel,as well as those with Switzerland-based Guido Haschke that in total amount to over 50 million euros,are said to be part of the kickbacks for the Rs 3,546-crore VVIP chopper deal,as per Italian investigations into the matter.
