Four purchasers found guilty in £66m corruption case

27 January 2012

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27 January 2012 | Angeline Albert

Four purchasing agents have been found guilty of conspiring to corruptly obtain payments by supplying confidential information about engineering contracts worth £66 million.

The men – Andrew Rybak (54) from Newbury, Ronald Saunders (63) from Hook, Philip Hammond (56) from Brussels and Barry Smith (70) from Farnham - worked for companies who acted as purchasing agents for oil and gas engineering projects and conspired between 2001 and 2009 to take bribes from bidders in exchange for insider information about contracts in Iran, Egypt, Russia, Singapore and Abu Dhabi.

The case was brought by the Serious Fraud Office and City of London Police at Southwark Crown Court, where the men will be sentenced on 30 January.

The SFO investigation, which began in 2008, focused on five projects.

Engineering and construction firm Snamprogetti provided procurement services for the construction of a styrene monomer plant in Iran. Ronald Saunders worked for the firm as an agent between 2001 and 2003 and passed inside information about a contract to Hammond and Rybak, who were co-directors of Strategic Project Services. They then passed the information to a bidding firm, which agreed to pay the men if the contract was awarded. The money was disguised as payments for “consultancy services”.

Saunders also worked as a contractor for J P Kenny from 2005 to 2007, which provided procurement services for the development of the QASR gas fields in Egypt. Saunders gave information to Rybak to pass on to a bidder, and when the £3 million contract was awarded Rybak received more than US$250,000 (£159,110), which he shared with Saunders.

In 2008, Foster Wheeler was hired by Hydrogen Energy International to provide purchasing services for the Hydrogen Power Abu Dhabi power plant. Both Rybak and Saunders were hired as contractors by Hydrogen Energy between 2008 and 2009. Approaches were made to bidders by Hammond, and Smith was also introduced to the conspiracy.

The SFO investigation began when one bidder rejected information offered by Rybak, and reported it to the procurement company. Charges were brought against the men in 2010.

In a statement the SFO said: “The companies that provided procurement services for these projects helped the investigation enormously. They were appalled at the apparent blatant disregard shown by these defendants for the confidentiality and integrity of the project environments.”

Update, 1 February 2012

On 31 January Rybak, Saunders, Hammond and Smith were given jail sentences for their roles in the scams.

Rybak received five years in prison. Saunders was given three years and six months in jail. Hammond was sentenced to three years. Smith was given a sentence of 12 months in jail, suspended for 18 months, and 300 hours of unpaid work.

Rybak and Hammond were also disqualified from acting as company directors for ten years and confiscation actions are being taken against those two men and Saunders.

In passing sentence Judge Deborah Taylor told the defendants: “Your activities in connection with these conspiracies had little, if anything, to do with the interests of those engaged with the project, but were parasitic, leeching money for your benefit.”

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