Employees at a Canadian potash firm run by a Chinese company are facing corruption allegations. MagIndustries Corp. issued a statement last week saying that it had formed a committee in response to the “Royal Canadian Mounted Office (RCMP) attending at the company’s head office with a search warrant”. The primary task of the committee is to review allegations that “certain officers and employees” breached Canada’s Corruption of Foreign Public Officials Act. The company did not provide any further details about the allegations.
Toronto-based MagIndustries further commented that no charges had so far been laid in connection with this investigation and “the company has no knowledge of any such breach and will be co-operating fully with the authorities”. MagIndustries, which is operated by Evergreen Resources Holdings Ltd., did not provide the names of the targeted employees and its spokesperson, Rich Morrow, did not reveal how many employees are being investigated either. At the same time, the company did not disclose which of the seven board members are on the special committee in charge of the investigation.
Canada has for long been criticized for very lenient enforcement regarding domestic firms bribing foreign officials. The RCMP has, however, intensified its investigation of corrupt companies, employees, and executives and its hunt in SNC-Lavalin Group Inc’s overseas activities has resulted in a number of charges. In 2013, for example, Griffiths Energy International Inc., which has rebranded itself to Caracal Energy Inc, was found guilty to bribing officials in Chad. The company had to pay a fine of more than $10 million. Two years earlier, Niko Resources Ltd, was also pleaded guilty of corruption practices and had to pay $9.5 million in penalty. The Niko case was the first of RCMP’s corruption hunt.