CBI registers FIR in $208 mn Embraer deal against UK-based arms dealer
The CBI on Friday said that it has registered an First Information Report (FIR) to probe allegations of kickbacks in the purchase of three Embraer aircraft in a $208 million deal inked in 2008 against a UK-based arms dealer. CBI sources said a case has been registered against a UK based NRI whose named had also figured in another defence deal probed by the premier investigation agency.
They said the kickbacks were allegedly paid in 2009 through subsidiaries of Embraer via a Singapore-based company which is owned by the middleman. They said the agency, which had registered a preliminary enquiry in September, has converted it into a regular FIR as enough prima facie material has been found by it to proceed in the case. It is alleged that payoffs were routed through Austria and Switzerland.
On September 17, the CBI registered a preliminary enquiry on a reference from the Defence Ministry over allegations related to Embraer employing an agent to facilitate various contracts. In 2008, the Defence Research and Development Organisation (DRDO) signed a $208 million deal with Embraer for three ERJ-145 aircraft to build indigenous Airborne Early Warning and Control Systems for the Indian Air Force.
A Brazilian newspaper had alleged that that the company had taken the services of middlemen to clinch deals in Saudi Arabia and India. According to defence procurement rules of India, middlemen are strictly barred in such deals. Leading Brazilian newspaper ‘Folha de Sao Paulo’ had reported that the company allegedly paid commissions to a UK-based defence agent to finalise the deal with India.
DRDO had purchased three aircraft from the company in 2008 and customized them for serving are air-borne radar system known as airborne early-warning and control systems or AWACS for the Indian Air Force. The company has been under investigation by the US Justice Department+ since 2010 when a contract with the Dominican Republic raised the Americans’ suspicions, the report said.
Since then, the investigation has widened to examine business dealings with eight more countries.