L&T and Cognizant Caught For Bribing Indian Officials: Here are all the details!
Why Would L&T Agree to Bribing Officials for Cognizant?
A scandal has freshly been busted, involving renowned companies Larsen & Toubro and Cognizant Technology Solutions Corp. As per reports, Larsen & Toubro has orchestrated a bribe of $3.64 million to Indian Government Officials on behalf of Cognizant Technology in order to settle various permits.
The permits include environmental clearance, power among many others at the company’s Chennai and Pune locations. This was all revealed by a person who confided under the terms of anonymity.
Read on to know more about how it all went down!
Cognizant India’s Bribes for Permits
In 2013, L&T, on the instructions of Cognizant India, paid $770,000 as a bribe to an official of Maharashtra government in order to clear the environmental permit for the Pune location of Cognizant.
In 2014, Larsen & Toubro was asked by Cognizant India to pay a bribe of $2 million to a senior government official to help acquire the permit for its campus in Knowledge Industry Township in Chennai.
In 2015, Cognizant again asked L&T to pay $870,000 to government officials to get construction-related permits cleared in Siruseri, Chennai.
Cognizant’s Cover Blown!
Former Cognizant president Gordon Coburn and former chief legal officer Steven Schwartz gave their consent to these illegal payments to Indian officials at the time of the construction of their corporate offices built in India.
The whole matter came to light thanks to the US Securities and Exchange Commission (SEC). They haven’t named L&T in the complaint which was made public the source has revealed the company’s ways of bribing. Apparently, L&T made all the illegal payments to the officials and Cognizant returned the money under the pretext of compensation for cost overruns.
The US Department of Justice (DoJ) and the US Attorney’s Office for the District of New Jersey held Coburn and Schwartz guilty for approving the payments and this is when the dark side of the companies was revealed to the public.
A hefty fine of $25 million was agreed to pay by Cognizant India to the Foreign Corruption Prevention Act with US authorities.
Schwartz and Coburn Innocent?
The accused, Coburn and Schwartz have refuted all charges against them and plan to fight for justice. Robert Finzi, attorney for Schwartz said, “History has shown that sometimes the government gets its facts wrong, and this is one of those times. Mr Schwartz is totally innocent and did nothing wrong. He will fight these false and unfair charges.”
Mysteriously, Coburn resigned from Cognizant in October 2016, when he was informed that some payments made to the Indian officials might breach the law. Hank Walter, Coburn’s attorney also assured that Coburn will fight against all the accusations.
However, why L&T carried out the transactions blindly is a big question. Why do you think L&T agreed to this? Share your opinions with us in the comments section!