Question mark over outcome of SC’s 2-year probe into bribery allegations linked to AirAsia

An investigation launched by the Securities Commission (SC) into AirAsia two years ago, related to an international bribery scandal that led to the arrest and jailing of former airline CEOs in at least two countries, appears to have seen no closure, MalaysiaNow has learnt.

On Feb 3, 2020, the SC announced that it would investigate AirAsia, just three days after prosecutors in the UK named the budget airline in a US$4 billion settlement deal with Airbus over allegations that the aircraft manufacturer had bribed officials worldwide to secure orders for its planes.

Among others, Britain’s Serious Fraud Office (SFO) said Airbus had paid a bribe of US$50 million to secure plane orders from AirAsia.

In its response, the SC said that details revealed in the case against Airbus had disclosed “several allegations against AirAsia Group Bhd and AirAsia X Bhd”.

“As both are listed on Bursa Malaysia, the SC will examine the allegations and review all available evidence to determine if there is any breach of securities laws,” SC chairman Syed Zaid Albar had said.

When contacted about the status of the probe, SC replied with a one-liner.

“SC cannot comment anything on investigations,” a spokesman for the capital market regulator told MalaysiaNow.

The SFO had alleged a bribe of US$50 million from Airbus in the form of sponsorships of a sports team owned by two persons it named as “Executive 1” and “Executive 2” in AirAsia.

“AirAsia Executive 1 and AirAsia Executive 2 were key decision makers in AirAsia and AirAsia X, and were rewarded in respect of the order of 180 aircraft from Airbus. The payments to the sports team were intended to secure or reward improper favour by them in respect of that business,” the SFO said in court documents sighted by MalaysiaNow.

AirAsia Group CEO Tony Fernandes and executive chairman Kamarudin Meranun subsequently announced that they were stepping down pending the investigation, but said they would remain as advisers during the two months they were away.

The company also announced an internal inquiry into the allegations, to be carried out by a committee comprising non-executive directors.

The committee later cleared Fernandes and Kamarudin, and both were reinstated to their positions on March 20, 2020.

But while AirAsia’s internal probe cleared the company’s bosses, two persons familiar with the issue told MalaysiaNow that they had not heard anything more from the SC on its investigation.

“There has been silence ever since,” said one of them.

Action in Sri Lanka, Indonesia

The bribery scandal triggered a worldwide investigation, with authorities in Sri Lanka and Indonesia bringing charges and jailing two airlines CEOs.

Days after details of the scandal were revealed in early February 2020, authorities in Sri Lanka arrested Kapila Chandrasena, a former CEO of SriLankan Airlines, and his wife Priyanka Niyomali Wijenayaka. They were charged with receiving a US$2 million bribe related to an agreement to purchase 10 Airbus aircraft for SriLankan Airlines.

Four months later, an Indonesian court jailed Emirsyah Satar, a former CEO of Garuda Indonesia, for bribery and money laundering related to the procurement of planes and engines from Airbus and Rolls-Royce.