August 25, 2003
Cape Town: The Lesotho Court of Appeal made strong statements about corruption in developing countries when it recently confirmed the conviction of Canadian engineering contracting firm Acres International on a charge of bribery.
Acres was found guilty of having bribed the CEO of the Lesotho Highlands Development Authority, Masupho Sole, to secure a lucrative contract for the construction of the Katse Dam. Sole, now in prison, received bribes totalling R12m from a number of international companies.
On Tuesday German engineering company Lahmeyer International will be sentenced on seven counts of bribery. Next in line for prosecution is French company Spies Batignolles. Seven or eight other international companies have been charged.
Acres appealed against both its conviction and sentence, but managed to have only the R22m fine reduced to R15m after it was acquitted by the appeal court on one of the charges as no conclusive audit trail was available.
In passing judgment, the three judges, led by judge president and former South African judge Jan Steyn, said the Lesotho prosecuting authorities had in launching the prosecution against developers and the officials “demonstrated courage, determination and competence. It has been an arduous task”.
“However they set an example of good governance, and have delivered a blow on behalf of all countries who face major challenges in strengthening their infrastructure through project activity.
“Corruption is of growing international and regional concern corruption has a particularly devastating impact on development and good governance in developing countries in Africa, because it undermines economic growth, discourages foreign investment and reduces the optimal utilisation of limited resources available for infrastructure, public services and antipoverty programmes.”
The judges wanted the sentence to send a strong message to developers. “The question of conviction alone is a far-reaching punishment because Acres will be unlikely to secure contracts funded by the World Bank.”