CBI Files Charge Sheet In Indian Embraer Deal, Names Middleman

The Indian Central Bureau of Investigation (CBI) has filed a charge sheet against a UK based arms dealer for allegedly taking kickbacks worth over US $5.7 million from the Brazilian Embraer in India’s 2008 three aircraft deal.

CBI sources said a case has been registered against a UK based NRI whose named had also figured in another defense deal probed by the agency.

They said the kickbacks were allegedly paid in 2009 through subsidiaries of Embraer via a Singapore based company which is owned by the middleman.

It is alleged that payoffs were routed through Austria and Switzerland.

The Indian Defense Ministry had asked the Central Bureau of Investigation (CBI) to probe in $208 million Embraer aircraft deal after allegations of payment of kickbacks to secure the airborne early warning and control systems (AEW&C) contract in September this year.

Indian Defense Mininster Manohar Parrikar had said, “CBI will be asked to probe if there is a criminal angle as the Ministry cannot.”

"If only procedural issues are involved, then the Defence Ministry can do an internal investigation," he had said.

The deal for purchase of three Embraer aircraft during the UPA regime has kicked up dust with the US authorities going into alleged payment of kickbacks.

The deal has come under the scanner of the US Justice Department, which has been probing Embraer for alleged payment of bribes to secure contracts.

DRDO has already sought a report from the Brazilian firm, which has said it has been looking into graft allegations over the last five years.

The deal was signed in 2008 between Embraer and the DRDO for three aircraft equipped with indigenous radars for AEW&C.

 A Brazilian newspaper recently alleged that that the company had taken the services of middlemen to clinch deals in Saudi Arabia and India.

According to defence procurement rules of India, middlemen are strictly barred in such deals.

Leading Brazilian newspaper 'Folha de Sao Paulo' had reported that the company allegedly paid commissions to a UK-based defence agent to finalize the deal with India.

DRDO had purchased three aircraft from the company in 2008 and customized them for serving are air-borne radar system known as airborne early-warning and control systems or AEW&CS for the Indian Air Force.

The company has been under investigation by the US Justice Department since 2010 when a contract with the Dominican Republic raised the Americans' suspicions, the report said.

Since then, the investigation has widened to examine business dealings with eight more countries.