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| Rolls-Royce: Serious Fraud Office launches probe | |
| (about 2 hours later) | |
| The Serious Fraud Office (SFO) has started a formal investigation into Rolls-Royce over concerns about bribery and corruption in its overseas markets. | The Serious Fraud Office (SFO) has started a formal investigation into Rolls-Royce over concerns about bribery and corruption in its overseas markets. |
| The aerospace firm said: "We have been informed by the Serious Fraud Office that it has now commenced a formal investigation into these matters." | The aerospace firm said: "We have been informed by the Serious Fraud Office that it has now commenced a formal investigation into these matters." |
| It was asked by the SFO to provide information about possible bribery in China and Indonesia in December 2012. | It was asked by the SFO to provide information about possible bribery in China and Indonesia in December 2012. |
| Some of the allegations date back more than 10 years. | Some of the allegations date back more than 10 years. |
| They involve Rolls-Royce's "intermediaries", which are local companies that handle sales, distribution, repair and maintenance in countries where the British firm does not have enough people on the ground. | They involve Rolls-Royce's "intermediaries", which are local companies that handle sales, distribution, repair and maintenance in countries where the British firm does not have enough people on the ground. |
| In December 2012, when Rolls-Royce started talks with the SFO, it highlighted that it had been strengthening its internal compliance procedure since 2008. | In December 2012, when Rolls-Royce started talks with the SFO, it highlighted that it had been strengthening its internal compliance procedure since 2008. |
| It also said it had established a new code of conduct and would be hiring an independent consultant to review its current procedures. | It also said it had established a new code of conduct and would be hiring an independent consultant to review its current procedures. |
| The British company employs more than 40,000 people in 50 countries. | The British company employs more than 40,000 people in 50 countries. |
| Likely impact | |
| Ben Bourne, an aerospace analyst at Liberum Capital, said: "It [Rolls Royce] has taken a pretty hard line already. It would have dealt with any problems." | |
| Mr Bourne said the probe shouldn't be problematic for the company if Rolls-Royce's engines are as "good as we think". | |
| In 2010, BAE Systems paid £286m in criminal fines, split between the US and UK, after it was accused of "wilfully misleading" over payments made to win contracts. | |
| Mr Bourne said if the fines for Rolls-Royce were similar, they would not be very serious for the company. |