Norway’s economic crimes unit Økokrim raided the defense communications arm of defense contractor and technology firm Kongsberg Gruppen on Tuesday, and charged the company with corruption. Authorities were tight-lipped, and wouldn’t immediately say whether any company executives or other individuals have been charged as well.
Marianne Djupesland, a prosecutor with Økokrim, told the website tied to newspaper Dagens Næringsliv, dn.no, only that their goal is “to gather information that can enlighten the actual situation, with a view towards eventually confirming or dismissing suspicion.”
Contracts valued at up to NOK 1.5 billion
Kongsberg Gruppen itself sent a report to the Oslo Stock Exchange that the charges are related to deliveries of communications equipment made to Romania from 1999 to 2008. The company wrote that it was first made aware of the charges on Tuesday and that the chairman of Kongsberg had been briefed. The charges involve the company’s Kongsberg Defence Communications AS unit (KDC), based in Asker just west of Oslo.
During the time period under investigation, Kongsberg sent out a series of press releases about contracts tied to the deliveries of communications equipment to Romanian customers, including Romania’s Ministry of the Interior. Among them, for example, was a contract in 2003 for the “extension and modernization of a telecommunication system in Romania,” valued at around NOK 300 million. Bjørn Wiggo Bjune, president of KDC at the time, said the contract “fortfied Kongsberg’s position” and was part of NOK 800 million in contracts signed in Romania during the preceding three years.
The Romanian Embassy reported on its website that the company has delivered communications and other technological equipment for both civilian and military purposes in recent years, and that it was valued at around NOK 1.5 billion.
‘Very serious and negative’
“This is a very serious and negative case for us, which we want to clear up as soon as possible,” Ronny Lie, head of communications at Kongsberg Gruppen, told dn.no.
Lie claimed that Kongsberg Gruppen stresses anti-corruption measures and the company wrote in a press release that it has “zero tolerance” for corruption. “We will now direct all our energy todays helping and supporting Økokrim to clarify the situation,” Lie said.
Kongsberg describes itself as an international, knowledge-based group that supplies high technology systems and solutions to customers engaged in the oil and gas industry, the merchant marine and the defense and aerospace industries. It is, for example, expected to be a major subcontractor for Norway’s order of new F35 fighter jets from US defense contractor Lockheed Martin. Based in the historic mining city of Kongsberg, west of Oslo, the company is also part of the so-called “Subsea Valley” comprising companies active in the offshore industry, and recently consolidated around 300 employees in Asker.
Its Defence Communications unit is said to design and manufacture high-quality ruggedized equipment to be used in advanced tactical communication systems around the world. Its website (external link) reports that the unit supplies “trunked network solutions at the brigade/battalion level” and mobile radio solutions. Kongsberg’s tactical communications solutions have been sold to customers in more than 30 countries over the past 40 years.
Kongsberg reported record operating revenues of NOK 16.3 billion last year, and has nearly 7,000 employees in more than 25 countries.