Guido Haschke accused of routing AgustaWestland cash for India’s helicopter contract

By David Pallister and Mark Watts | 16 April 2014

Italian prosecutors have agreed a ‘plea bargain’ with a middleman who they accused of bribing Indian officials to help Britain secure a huge helicopter contract.

Pressure mounts on AgustaWestland, the British helicopter maker, over the corruption allegations as an Italian judge approved the plea bargain between Italian prosecutors and Guido Haschke.

And ministers in Britain face even more questions over the affair after Exaro revealed last month that the UK government helped AgustaWestland, a subsidiary of Italian-based Finmeccanica, secure the €560 million deal to supply 12 AW101 helicopters to the Indian Air Force in 2010.

“Call Monti or Ambassador Terracciano on my behalf to ask him to call PM Singh”
– Note allegedly written in jail by Giuseppe Orsi, AgustaWestland’s ex-chief executive

That disclosure undermined efforts by David Cameron, prime minister, to distance the UK from the corruption allegations. Exaro revealed last May that the UK was failing to help India with its investigation, despite promises by Cameron.

Italian prosecutors allege that AgustaWestland paid around €50 million in bribes to win the contract to supply the helicopters, which included eight for transporting VIPs. They claim that some of the bribes were routed through Haschke’s consulting business.

In addition, transcripts of bugged telephone conversations shed light on the role of a British businessman, Christian Michel, as a middleman in the contract.

The deal is also under criminal investigation in India. In January, the Indian government cancelled the contract after delivery of three of the helicopter amid bribery allegations, after delivery of three of the helicopters.

The helicopters were being made at the site of Westland Helicopters, a predecessor company to AgustaWestland, in Yeovil, Somerset. Westland Helicopters, which was at the centre of a political drama three decades ago, has returned to haunt a Conservative prime minister.

Under the plea bargain, Haschke has been sentenced for international corruption to serve 22 months in home detention or perform community service. The judge is expected to give reasons for the sentence later this month.

Agreeing to a plea bargain, however, does not mean an admission of guilt under Italian law. But an Italian judge has to be sure that there are no reasons for an acquittal before accepting such an agreement.

A plea bargain means a shorter sentence than would follow a conviction.

Haschke, a Swiss-resident with dual Italian and American nationality, has never publicly admitted the allegations and neither he nor his lawyer could be reached for comment.

In evidence to the court, Haschke said that he was a consultant and that his company entered into engineering contracts for the deal.

Giuseppe Orsi, former chief executive of AgustaWestland, who went on to become chief executive and chairman of Finmeccanica, and Bruno Spagnolini, who succeeded Orsi as AgustaWestland’s chief executive, are on trial in the industrial city of Buston Arsizio, near Milan over the bribery claims. They are charged with international corruption and falsifying invoices.

Orsi, Spagnolini, Finmeccanica and AgustaWestland continue to deny wrongdoing.

They say that consultancy deals were not vehicles to pay bribes to Indian officials, as prosecutors allege, but were for engineering services.

Haschke was one of more than a dozen people under investigation in Italy over the deal, but not so far charged.  He was extradited to Italy from Switzerland last October.

Meanwhile, the Italian prosecution produced a hand-written note that it claimed was recovered last year from Orsi’s jail cell, where he is being held on remand.

The note asked an unidentified person to contact the then Italian prime minister, Mario Monti, or Italy’s ambassador to the UK, Pasquale Terracciano. The note requests that Monti or Terracciano telephones India’s prime minister, Manmohan Singh.

The note said: “Call Monti or Ambassador Terracciano on my behalf to ask him to call PM Singh.”

The prosecution claims that the note shows how highly connected Orsi was in powerful circles in Italy.

The case embarrassed the Indian government in the run up to the country’s parliamentary elections.

Geoff Hoon, former defence secretary and AgustaWestland managing director for international business since 2011, is set to be called as a witness in the trial. He is expected to be asked to testify on how India procures defence projects.

Three weeks ago, Exaro revealed how a key UK diplomat who helped secure the deal went on to become chief executive and managing director of AgustaWestland India.

Related Stories : Bribery claims, ‘Sangcom’ and ‘Al Yamamah’: Exaro story thread

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