US co bribed PSUs to bag big contracts

NEW DELHI: In a major embarrassment for the state-owned companies, US Department of Justice has told a US court that officials of Bhel and NTPC were among those who were bribed by the California-based valve company, Control Component Inc ( CCI), for bagging big contracts.

According to the documents submitted by the justice department, officials of Bhel, NTPC, Bhilai Electric and Haryana State Electricity Board were the beneficiaries of corrupt payments. CCI has admitted that from 2003 through 2007, it had made approximately 236 corrupt payments in more than 30 countries, which resulted in net profits to the company of approximately $46.5 million from sales related to those corrupt payments. India, China, the UAE and Qatar are some of the major countries where CCI indulged in unfair practices to bag contracts.

According to court documents, the payments related to India were made between 2004 and 2007.

Topping the list is the Sipat coal-fired power plant of NTPC, for which CCI paid a bribe of $163,449 in two installments to an official of a Moscow-based company, who has been identified as Vladimir Batenko in the documents submitted by the US Department of Justice before the US court.

The alleged bribe for the Sipat thermal power plant was paid in two installments. The first payment of $26,865 was made on November 29, 2005, from the company’s Handelsbanken Bank account in Sweden to an account at Dresdner Bank in New York for the purpose of securing the contract for the Sipat thermal power plant. The second payment of $136,584.98 was made in October, 2006, from the same Handelsbanken Bank account in Sweden to an account at the Baltic International bank in Latvia, the FBI alleges, for the purpose of making a corrupt payment to a Company 3 employee with regard to the Sipat thermal power plant in India. According to court documents, the CCI — in two installments on November 6, 2006, and January 9, 2009 —made a total payment of $69,012 to Bhel and MSEB.



Bhel officials are reported to be the beneficiaries in several other instances, but most of the amounts are less than $5,000. In 2007, officials of the Bhilai Electricals are believed to have received $8,600, while those of HSEB received $15,802 through a transaction on July 7, 2007. Besides these, Spin Industries, J Mehta & Co and MSEB were the beneficiaries of another bribery transaction of $15,000 made by CCI on March 3, 2004.

Meanwhile, Bhel and NTPC denied the allegations. “Something like this is not possible. It’s surprising that nobody has identified this so far and a US firm is now implicating us,” said Bhel in a statement. “Prima facie we don’t purchase components from the market — we have vendors to do that. It could be possible that some vendor would have been involved who supplies to NTPC,” it said.