Avianca Launches Internal Airbus Corruption Probe

Avianca Holdings has launched an internal corruption probe. The company is trying to find out if an employee of the business was involved in corrupt acts by Airbus.

Avianca B787
Avianca launched an internal probe. Photo: Avianca Holdings.

The alleged corruption happened before March 2016

In a statement, Avianca said,

“The agreement between Airbus and the authorities has very delicate and worrisome accusations against the acts of a member of Avianca during a timeframe before March 2016”.

In May 2015, both Avianca and Airbus announced that the carrier would buy up to 100 A320neo aircraft. Airbus announced Memorandum of Understanding in February of that same year. Airbus said this was the largest single order ever made in Latin America’s aviation history. We asked Avianca if this purchase agreement was part of the corruption probe. At the time of publication, we had no answer from the airline.

The international law firm Ropes & Gray will lead the internal probe. Anko van der Werff, Avianca’s CEO, said that the new administration of the airline rejects any act that doesn’t reflect integrity and transparency.

Anko van der Werff, new Avianca CEO
Anko van der Werff said there is no place for corruption in Avianca. Photo: Daniel Martínez Garbuno.

Last week Airbus avoided criminal charges

Airbus decided to settle out of court against a corruption probe. The European company will pay up to $4 billion USD to avoid criminal charges from an inquiry headed by British, French and American authorities. The Department of Justice said that this was the largest ever bribery settlement for a company outside the US.

This investigation found out that Airbus bribed different firms and agencies, through an ‘agent’ network’, to obtain aircraft sales. The case began in 2016 when Tom Enders (who was, at the time, the CEO of Airbus) alerted the regulators.

According to what we know, Airbus used third-party sales agents. These agents, in collaboration with the British Export Credit Agency (BECA), acquired millions of dollars to facilitate aircraft sales around the world. In 2014, Airbus discovered false statements, halted the payments and alerted the authorities.

So Avianca is trying to find out if the carrier was a victim of any wrongdoing. The airline will take any legal action to defend both the company and its investors.

Avianca Airbus A320
Avianca has a restructuring plan to survive another 100 years. Photo: Avianca

Avianca’s turnaround

During the last months, Avianca has been all over the news. It all started when the company secured a loan of up to $250 million USD, plus another $155 million USD extra, in cash. This also meant the oust of German Efromovich, former owner of the carrier. Instead, now Kingsland Holdings is in charge while United Airlines keeps an eye on the whole management.

Then Anko van der Werff took the CEO position and started a restructuring plan under the new banner of “Avianca 2021”.

At the moment, there is no fear of bankruptcy for the airline, and everyone is on board to go another hundred years. “The company’s outlook made a 180 degrees turn in the last six months. We see with certainty and enthusiasm into the future” said van der Werff.

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