Larsen & Toubro bribed Indian officials on Cognizant’s behalf to get clearances for campuses: Mint
The bribes, totalling $3.64 billion, were paid to government officials from 2013 to 2015.
The construction firm that bribed Indian authorities on behalf of technology company Cognizant was Larsen & Toubro, Mint reported on Monday, quoting an official. Cognizant was last week fined $25 million by the United States’ Department of Justice for the bribes, and two of its former executives were charged on 12 counts.
The Securities and Exchange Commission, which regulates US markets, had alleged that a Tamil Nadu government official had in 2014 demanded a $2-million (more than Rs 14.27 crore, at current exchange rate) bribe from the construction firm tasked with building a campus for Cognizant in Chennai. Cognizant’s President Gordon Coburn and Chief Legal Officer Steven E Schwartz allegedly authorised the contractor to pay the bribe, and directed their subordinates to conceal the payment by doctoring documents.
Cognizant also authorised the construction company to pay two more bribes, totalling more than $1.6 million (Rs 11.4 crore), and then “used sham change order requests to conceal the payments it made to reimburse the firm”, the markets regulator had alleged.
On Friday, the company was found to have violated the Foreign Corrupt Practices Act, and Coburn and Schwartz were charged, Reuters reported.
On Monday, Mint reported, citing an unidentified official, that the construction firm was Larsen & Toubro, which allegedly facilitated the payment of $3.64 million (Rs 25.9 crore) in bribes to government officials in Maharashtra and Tamil Nadu on behalf of Cognizant between 2013 and 2015. The bribes were paid to get environmental and other clearances for Cognizant’s campuses in Chennai and Pune.
Cognizant reimbursed the money to Larsen & Toubro’s construction arm by disguising it as compensation for cost overruns, the official said.
Apart from the $2-million bribe paid in 2014, Cognizant India also asked Larsen & Toubro to pay $770,000 (nearly Rs 5.5 crore) in bribes to a Maharashtra government official to get environmental clearances in Pune, and $870,000 (Rs 6.21 crore) in Chennai for similar permits, Mint reported.
Last year, India jumped 23 spots to rank 77 out of 190 nations in the World Bank’s Ease of Doing Business index. In 2017, India had jumped 30 places to be ranked at 100th.