Exclusive: Austrian prosecutors investigate Airbus CEO over suspected fraud

News 26 Apr 2017
Exclusive: Austrian prosecutors investigate Airbus CEO over suspected fraud

Thomas Enders, Chief Executive Officer of EADS speaks at a ground breaking ceremony for Airbus for its first U.S. assembly plant in Mobile, Alabama April 8, 2013. REUTERS/Lyle Ratliff By Kirsti Knolle | VIENNA

VIENNA Vienna prosecutors are investigating Airbus Chief Executive Thomas Enders for suspected fraud in connection with a $2 billion Eurofighter jet order by Austria more than a decade ago, the prosecutors' office said.

Correspondence reviewed by Reuters listed Enders as one of those accused in the investigation, and a spokeswoman for the Vienna prosecutors' office said that information was correct.

"I can confirm that," the spokeswoman, Nina Bussek, said on Wednesday when asked whether Enders was being investigated.

Airbus spokesman Martin Aguera declined to comment. Enders could not be reached for comment.

In February, Vienna prosecutors opened a criminal investigation after the defense ministry said it believed Airbus and Eurofighter misled decision-makers about the purchase price, deliverability and equipment of the 2003 warplane order.

A person close to Airbus, asking not to be named, said Enders had not been notified of any proceedings against him and had not so far been considered a witness in the investigation.

Enders and Airbus, which was called European Aeronautic, Defence and Space Company (EADS) at the time the fighter jet order was agreed, have repeatedly denied any wrongdoing.

Enders was head of EADS's defense division when the contract was signed. He took responsibility for combat aircraft a few months later.

The Eurofighter consortium, which comprises BAE Systems, Italy's Leonardo and Airbus, has also denied any wrongdoing.

Airbus shares shed gains after Reuters reported that Enders was being investigated, and fell as much as 1.1 percent. They were up 0.3 percent at 74.32 euros at 1440 GMT.

Austrian and German prosecutors have separately been investigating for years whether officials received bribes aimed at ensuring they chose Eurofighter jets over rival offers from Saab and Lockheed Martin.

Allegations surfaced almost immediately after the purchase was agreed that money was pocketed by politicians, civil servants and others via brokers for so-called offset deals accompanying the transaction.

These deals, common in large arms purchases, are designed to provide work for local businesses in countries placing orders.

Austria's defense ministry has alleged Airbus and the Eurofighter consortium illegally charged nearly 10 percent of the purchase price of 1.96 billion euros for these side deals.

(Additional reporting by Victoria Bryan and Tim Hepher; Editing by Francois Murphy, Keith Weir and Mark Potter)

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