Lafarge accepted $778m fine after confessing in US trial to scheming to provide material support to a terrorist organization
The French cement company Lafarge confessed on Tuesday to paying millions of dollars to the Islamic State group in exchange for permission to continue operations of a plant in Syria, in a case the US justice department classed as the first of its kind. The company also accepted penalties amounting to about $778m (£688m).
Prosecutors condemned Lafarge for ignoring the conduct of the militant group, arranging payments to it in 2013 and 2014 as IS inhabited a broad swath of Syria and as some of its members were involved in beheading or torturing kidnapped westerners. The company’s actions took place before it merged with a Swiss company Holcim, to create the world’s biggest cement-making business.
The payments were aimed at ensuring the continued operations of a $680 million plant that prosecutors say Lafarge had built in 2011 at the onset of the Syrian civil war. The money was to be used to protect employees and maintain a competitive edge.
The assistant attorney general, Matthew Olsen, the justice department’s top national security official, said in an official statement.
“The defendants routed nearly $6m in illicit payments to two of the world’s most notorious terrorist organizations – Isis and al-Nusrah Front in Syria – at a time those groups were brutalizing innocent civilians in Syria and actively plotting to harm Americans. There is simply no justification for a multinational corporation authorizing payments to designated terrorist organizations.”
These charges were declared by senior justice department leaders from Washington and by federal prosecutors in New York City. The justice department said it was the first case in which a company had admitted fault for scheming to provide material support to a foreign terrorist organization.
The accusations involve conduct that was earlier looked into by authorities in France. Lafarge had previously accepted channeling funds to Syrian armed organizations in 2013 and 2014 to ensure safe passage for employees and supply its plant. In 2014, the company was presented with preliminary charges including funding a terrorist enterprise and involvement in crimes against humanity.
A French court later withdrew the charges involving crimes against humanity but said other charges would be reviewed over payments made to armed forces in Syria. That ruling was later reversed by France’s Supreme Court, which ordered a retrial in September last year.
Buy Crypto NowThe wrongdoing comes before Lafarge’s merger with Holcim in 2015.
In a statement, Holcim said that when it became aware of the accusations from the news media in 2016, it voluntarily carried out an investigation and reported the findings publicly. It dismissed the former Lafarge executives who were involved in the payments. The company said:
“None of the conduct involved Holcim, which has never operated in Syria, or any Lafarge operations or employees in the United States, and it is in stark contrast with everything that Holcim stands for. The DOJ noted that former Lafarge SA and LCS executives involved in the conduct concealed it from Holcim before and after Holcim acquired Lafarge SA, as well as from external auditors.”
