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Canadian authorities probing employees of SNC-Lavalin Group

A pedestrian walks past the SNC-Lavalin Group Inc., headquarters in Montreal
A pedestrian walks past the SNC-Lavalin Group Inc., headquarters in Montreal

WASHINGTON (Reuters) - Canadian authorities are investigating employees of SNC-Lavalin Group Inc for possible corruption involving a $1.2 billion World Bank bridge project in Bangladesh, a bank spokesman said on Friday.

The World Bank said it had been informed that the Royal Canadian Mounted Police had raided several locations as part of their investigation. SNC-Lavalin confirmed it was cooperating with Canadian authorities, but gave no details.

Canadian authorities launched the probe following a referral from World Bank officials about alleged corruption in the bidding process for the Padma Bridge, a bank spokesman said. He said the bank was continuing its own investigation.

The World Bank approved financing for the Padma Bridge project in April, but had not disbursed any funds given the ongoing investigation, said the spokesman.

"We commend the Royal Canadian Mounted Police for its robust response to the World Bank referral and look forward to the outcome of its investigation," said the spokesman.

Leslie Quinton, a spokeswoman for SNC-Lavalin, said the company was assisting Canadian authorities with an investigation on a specific case, but gave no further details.

"We are complying fully with their requests and are not aware of any reason that would warrant such an investigation," Quinton said. "Because the situation is under investigation, we cannot comment any further."

Constable Julie Morel, spokeswoman for the Royal Canadian Mounted Police, confirmed that the police agency had executed search warrants at several locations as part of an investigation of SNC-Lavalin employees on Thursday.

She declined to identify which locations or to provide any further details since the investigation was still under way.

The World Bank signed a 40-year deal in April to loan $1.2 billion to Bangladesh to build a bridge linking its underdeveloped south with the capital, Dhaka, and the country's main port, Chittagong.

An international consortium, led by the World Bank, last year agreed to lend Bangladesh up to $2.9 billion for the 6-km (4-mile) multi-purpose bridge over the river Padma.

The bridge, about 50 km (30 miles) south of Dhaka, is expected to be completed by 2014, improving transportation between Bangladesh and other countries, and establishing a missing link along the longest corridor under the Asian Highway Network that connects Tokyo to Istanbul.

The World Bank last week outlined its increased efforts to prevent and deter fraud and corruption. Over the past year, the bank said its new Preventive Services Unit (PSU) had helped build precautions against fraud into 48 high-risk projects in 29 countries with a total value of $14.1 billion.

The bank said it had trained over 2,700 government officials and bank staff on how to conduct forensic audits and identify suspicious transactions.

(Reporting by Andrea Shalal-Esa and Tim Ahmann; editing by Carol Bishopric)

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