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Port giant in bribery probe
Benjamin Scent
Monday, January 12, 2009
China Harbour Engineering Co - which documents reveal is a precursor company of Hong Kong-listed China Communications Construction Co Ltd (1800) - bribed its way to a port contract in Bangladesh, the US Department of Justice alleges.
US government attorneys are seeking to recover US$1.76 million (HK$13.6 million) they say China Harbour paid in bribes to Arafat "Koko" Rahman, the youngest son of former Bangladesh prime minister Khaleda Zia. Rahman allegedly squirreled the money away in Singapore bank accounts.
China Harbour Engineering Co Ltd is now a fully owned subsidiary of Hong Kong-listed CCCC, according to its 2007 annual report.
In the prospectus for its December 2006 initial public offering, CCCC listed the Bangladesh Chittagong Port project as one of its representative overseas projects.
China Harbour allegedly sent bribes to Rahman to ensure it would win a US$131 million contract to build the largest new mooring container terminal in Bangladesh, located in Chittagong, US government attorneys claimed in court documents filed last week.
The filing does not mention details about China Harbour or who owns it.
"Payments were made to Koko to influence the bidding process and to ensure that Koko would not obstruct the award of the project to China Harbour," US Department of Justice attorneys said in a forfeiture action filed with the US District Court in the District of Columbia last Thursday.
"The son of the former Inland Marine Minister has confess
ed that he and Koko received bribe payments from China Harbour," they said. The former minister was not named. CCCC could not be reached for comment.
The US government is also seeking to recover US$3.4 million in bribes German industrial giant Siemens transferred to accounts at United Overseas Bank and Standard Chartered Bank in Singapore between 2001 and 2006. The money was doled out to Bangladesh government officials and their family members, including Rahman, so Siemens could secure a US$40.89 million contract to build a mobile- phone network. Siemens has already pleaded guilty to the charges.
The US Department of Justice, which claims jurisdiction since the bribes were allegedly routed through US banks, is seeking to recover the funds under US money-laundering laws.
No charges have been filed against China Harbour.
The US attorneys claim Rahman would demand bribes from firms bidding for government contracts.
"As the prime minister's son, Koko in most cases was paid 'protection money' to ensure that he did not use his influence to obstruct the award process," they said in the court filing.
China Harbour allegedly made two payments to Rahman in May 2005 in connection with the Chittagong project - a wire transfer of US$626,828 and another of US$565,349, both to a Rahman-controlled account at United Overseas Bank in Singapore, the US court documents claim.
China Harbour then made another wire transfer of US$564,658 to the account in August 2005, the US government attorneys allege. The account, number 1093101397, was under the name of ZASZ Trading and Consulting Pte Ltd, a Singapore company controlled by Rahman, they said.
China Communications Construction Group, the parent of now-listed CCCC, was formed in December 2005 by the merger of two state-owned enterprises - China Harbour Engineering Co (Group) and China Road and Bridge Corp.
Substantially all the businesses and assets of these two precursor companies were later transferred to CCCC in preparation for its Hong Kong listing, CCCC said in its IPO prospectus.
Rahman and his mother were arrested in Bangladesh in September 2007 following separate charges from the country's Anti-Corruption Commission.
He was later released on parole and is now in Bangkok receiving medical treatment, according to Bangladesh media reports.
Benjamin Scent
Monday, January 12, 2009
China Harbour Engineering Co - which documents reveal is a precursor company of Hong Kong-listed China Communications Construction Co Ltd (1800) - bribed its way to a port contract in Bangladesh, the US Department of Justice alleges.
US government attorneys are seeking to recover US$1.76 million (HK$13.6 million) they say China Harbour paid in bribes to Arafat "Koko" Rahman, the youngest son of former Bangladesh prime minister Khaleda Zia. Rahman allegedly squirreled the money away in Singapore bank accounts.
China Harbour Engineering Co Ltd is now a fully owned subsidiary of Hong Kong-listed CCCC, according to its 2007 annual report.
In the prospectus for its December 2006 initial public offering, CCCC listed the Bangladesh Chittagong Port project as one of its representative overseas projects.
China Harbour allegedly sent bribes to Rahman to ensure it would win a US$131 million contract to build the largest new mooring container terminal in Bangladesh, located in Chittagong, US government attorneys claimed in court documents filed last week.
The filing does not mention details about China Harbour or who owns it.
"Payments were made to Koko to influence the bidding process and to ensure that Koko would not obstruct the award of the project to China Harbour," US Department of Justice attorneys said in a forfeiture action filed with the US District Court in the District of Columbia last Thursday.
"The son of the former Inland Marine Minister has confess
ed that he and Koko received bribe payments from China Harbour," they said. The former minister was not named. CCCC could not be reached for comment.
The US government is also seeking to recover US$3.4 million in bribes German industrial giant Siemens transferred to accounts at United Overseas Bank and Standard Chartered Bank in Singapore between 2001 and 2006. The money was doled out to Bangladesh government officials and their family members, including Rahman, so Siemens could secure a US$40.89 million contract to build a mobile- phone network. Siemens has already pleaded guilty to the charges.
The US Department of Justice, which claims jurisdiction since the bribes were allegedly routed through US banks, is seeking to recover the funds under US money-laundering laws.
No charges have been filed against China Harbour.
The US attorneys claim Rahman would demand bribes from firms bidding for government contracts.
"As the prime minister's son, Koko in most cases was paid 'protection money' to ensure that he did not use his influence to obstruct the award process," they said in the court filing.
China Harbour allegedly made two payments to Rahman in May 2005 in connection with the Chittagong project - a wire transfer of US$626,828 and another of US$565,349, both to a Rahman-controlled account at United Overseas Bank in Singapore, the US court documents claim.
China Harbour then made another wire transfer of US$564,658 to the account in August 2005, the US government attorneys allege. The account, number 1093101397, was under the name of ZASZ Trading and Consulting Pte Ltd, a Singapore company controlled by Rahman, they said.
China Communications Construction Group, the parent of now-listed CCCC, was formed in December 2005 by the merger of two state-owned enterprises - China Harbour Engineering Co (Group) and China Road and Bridge Corp.
Substantially all the businesses and assets of these two precursor companies were later transferred to CCCC in preparation for its Hong Kong listing, CCCC said in its IPO prospectus.
Rahman and his mother were arrested in Bangladesh in September 2007 following separate charges from the country's Anti-Corruption Commission.
He was later released on parole and is now in Bangkok receiving medical treatment, according to Bangladesh media reports.
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