Alcoa bribes totaled $9.5 million, amended lawsuit says
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Companies affiliated with Alcoa paid some $9.5 million in bribes to officials of the government of Bahrain and a government-controlled aluminum company, according to an amended complaint filed in U.S. District Court late Monday.
The complaint filed by attorneys representing Aluminum Bahrain BSC, called Alba, marks the start of a new phase in a long-dormant lawsuit that spurred an ongoing international corruption investigation. Alcoa had asked the court to allow the suit, frozen since early 2008, to proceed, so it can seek to clear its name.
The first step, though, was Alba detailing its previously vague accusations.
In the 47-page amended complaint, Alba said that Alcoa was its supplier of raw alumina for decades. Alba operates what it characterized as the world's biggest smelter for turning alumina into aluminum.
Alcoa was originally the direct supplier of alumina, but then began working through a London-based intermediary, Victor Dahdaleh, according to the complaint. It said he operated a series of companies that provided no actual services but served as middlemen in alumina deals and sometimes used Alcoa's logo on their correspondence.
The complaint detailed what it described as bribes from Mr. Dahdaleh to unidentified executives at Alba and officials of Bahrain starting with a $40,000 payment in 2002, including several payments of about $2 million, and ending with a $266,000 payment in 2005.
In return, according to the complaint, Alba paid more than market price for alumina supplied by Alcoa through Dahdaleh's firms. It estimated that from 1997 through 2009, Alba paid $419.8 million more for alumina to Dahdaleh's firms than those firms paid to Alcoa subsidiaries for the material.
It also said Alcoa made a bid, backed by Dahdaleh's bribes, to buy a large share in Alba for $600 million, which was a significant discount on the actual value of the stake in the smelter company. That bid fell through.
The complaint seeks $1 billion in damages.
It also notes that Mr. Dahdaleh was charged in October by the United Kingdom's Serious Fraud Office with corruption in connection with his role in deals between Alcoa and Alba. It said that a former unidentified CEO of Alba has also been arrested, in Australia, in relation to the matter.
First Published November 29, 2011 10:17 am
