What exactly is the Louis Berger bribery case?

GOANEWS DESK, PANAJI | 07 August 2015 13:32 IST

Louis Berger bribery case is the first corruption-related case that has led to the arrests of heavyweight politicians and senior government officials, after the Bharatiya Janata Party came to power in Goa in 2012, assuring the people to put all the corrupt Congressmen behind the bars.

Even after ruling the state for three and a half years, the BJP is still claiming that it will arrest the politicians and other businessmen involved in a multi-core mining scam, but before 2017 election. However, the Louis Berger bribery case erupted suddenly, not from Goa, but the USA.

To Goa: With thanks from the USA

The corruption case came to light in New Jersey, USA when Louis Berger International Inc., the US-based consultancy firm, admitted to having bribed a Goan minister and government officials to get a project, financed by Japan International Cooperation Agency (JICA).

Former executives of Louis Berger, Richard Hirsch (61) of Philippines and James McClung (59) of UAE, pleaded guilty on 17 July in federal court in Trenton, New Jersey of paying bribes.

The hearing to announce their sentence would be held on 5 November.

The firm admitted that it paid $ 3.9 million, between 1998 and 2010, to officials in India, Vietnam and Kuwait.

The US-based construction management company has now agreed to pay $ 17.1 million to resolve the US bribery probe.

The Justice Department charged the company on 7 July with a conspiracy to violate the Foreign Corrupt Practices Act.

The consultancy firm admitted of having paid a bribe of $976,630 for a Goa project of water supply and sewerage - to expand, rehabilitate and build water and sewerage facilities.

They admitted of paying bribes for winning a similar project also in the state of Assam, besides Goa.

It was alleged that the company won two water developmental projects, along with three more consortium partners - two Japanese firms and an Indian partner.

The five-year project is funded by JICA and assisted by Government of India. 

The consortium developed a project management information system and plan, evaluated bids, reviewed design and construction plans, and ensured quality work was done on time and within budget.

Bribes paid with code words

In the 11-page chargesheet filed before the Department of Justice, it was stated that the Louis Berger firm maintained a detailed diary and account of bribes paid to Indian officials and politicians.

Officially, the amount is now shown as bribe but different code words are used, like ‘commitment fee’, ‘counterpart per diem’, ‘marketing fee’, ‘field operation expenses’, ‘drawings’ etc.

 

The court documents however state that the cash disbursement forms and invoices did not truthfully describe the services provided of the purpose of the payment. They were actually bribes.

Berger has not disclosed names of the politicians and officials whom the bribe was paid. But the Department of Justice has agreed to make it available if Government of India asks for it.

A letter Regatory has already been initiated to avail the documents from the US court for collecting corroborative evidence.

U turn on CBI probe

When the news broke in India in the second fortnight of July, the Bharatiya Janata Party’s Chief Minister Laxmikant Parsekar immediately demanded a probe by the Central Bureau of Investigation.

Even Goa Assembly, in its ongoing monsoon session, debated the issue on 27 July, where most of the ruling party legislators echoed a similar demand.

It was argued that the matter involves other countries like the USA, thus it should be probed by a central agency.

However, Goa CM Parsekar this week suddenly changed his stand on CBI inquiry.

“Goa police is doing an excellent job”, he said while hesitating to forward the demand of CBI inquiry.

The Goa police has not only arrested officials of Goa government and Louis Berger, but also former PWD minister Churchill Alemao, during whose tenure Louis Berger was selected as the consultant.

Countering the allegation of opposition parties, Parsekar has denied any political interference in the probe.

A minister or 2 ministers?

On the other hand, India’s defence minister Manohar Parrikar, who headed Goa government earlier, made a revelation that two Goan ministers are involved in the bribery scandal, hinting at former PWD minister Churchill Alemao and chief minister Digambar Kamat, who was also controlling the finance portfolio.

Pending a demand for CBI probe, the crime branch of Goa police have started investigating the case and have already arrested three accused so far, including former minister Alemao.

It started with crime branch of Goa police registering a case on 21 July and raiding Goa’s office of JICA-funded project, headed by former PWD chief engineer A M Wachasundar.

 

The crime branch officials also managed to get three former officials of Louis Berger working in India and another local consultancy partner, who deposed before the Goa magistrate and disclosed that bribes were paid to former chief minister Digambar Kamat and former PWD minister Churchill Alemao.

However, the police did not arrest them for giving bribes but left them free after getting the deposed before the magistrate.

Three arrests so far…

But Wachasundar was immediately suspended by the BJP government on 26 July and arrested the next day.

After spending eight days in police custody, he has been now remanded to judicial custody.

Meanwhile, the Goa police also summoned Kamat and Alemao and interrogated them.

On the other hand, Satyakam Mohanty, former vice president of India’s office of Louis Berger, was arrested on 3 August. He is still in the police custody.

The police probe took a twist after Wachasundar suddenly withdrew his application for anticipatory bail on 4 August, after which Goa’s former CM Kamat moved for an anticipatory bail the next day, fearing arrest.

He charged that Wachasundar has been compelled by the police to implicate him and converting the probe into political vendetta. Kamat’s Congress party is now in the opposition.

Same night, on 5 August, Alemao was picked up from his residence in South Goa and arrested. He has been now remanded to four-day police custody.

Hearing on Kamat’s anticipatory bail would be held on 7 August, after which it would be clear whether Goa police plan to arrest the former CM.

Both Kamat and Alemao have dubbed the action as political revenge by the ruling party while Kamat says he has not even the seen the file of JICA project, forget signing its approval.

Surprisingly, the file in the PWD is missing.

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