December 17, 2018

Long-running bid-rigging and corruption scandal involving Canadian engineering and construction management company nearing an end

On November 26, 2018, Yanai Elbaz pleaded guilty in Canada to four counts of bribery, breach of trust, money laundering, and influence trafficking involving a contract won by SNC-Lavalin Group, Inc., for the construction of a multibillion dollar hospital complex at McGill University in Montreal (the “CUSM”).  According to the statement of facts tied to the plea agreement, Elbaz, in concert with others, orchestrated the payment of secret commissions totaling CAD 22.5 million by SNC-Lavalin (of which Elbaz received CAD 10 million) in order to rig the bid process in its favor.  At the time, Elbaz was the deputy director of the CUSM.  The court sentenced Elbaz to 39 months in prison.  CUSM joined the litigation against Elbaz, requesting that the court freeze CAD 6 million in a Swiss bank account belonging to Elbaz, but the court deferred the hospital’s restitution request to subsequent civil proceedings.  Pierre Duhaime, the former CEO of SNC-Lavalin, who was allegedly involved in the corrupt scheme, will stand trial in February 2019.  Riadh Ben Aïssa, a former SNC-Lavalin vice president, pleaded guilty in July 2018  to reduced charges in connection with the scandal.  Elbaz’ brother, Yohann Elbaz, an attorney, has been charged with money laundering and fraud for his alleged involvement.