By Adedapo Adesanya
French cement maker, Lafarge, has pleaded guilty in the United States to supporting the Islamic State and other terror groups and agreed to a $777.8 million penalty for payments it made to keep a factory running in Syria after war broke out in 2011.
The cement manufacturer, bought by Switzerland’s Holcim in 2015, said its behaviour had been in “flagrant violation” of Lafarge’s code of conduct.
Lafarge also said it “deeply regretted” the events and “accepted responsibility for the individual executives involved”.
The firm opened its plant in Jalabiya near the Turkish border in 2010 following a $680 million investment.
US prosecutors said that Lafarge’s Syrian subsidiary had paid Islamic State and another terror group, al Nusra Front, the equivalent of $5.92 million to protect staff at the plant as the country’s civil war intensified, but executives likened the arrangements to paying “taxes”, the company said.
Lafarge eventually evacuated the plant in September 2014, when Islamic State took control of the town and the factory but before its departure, the deals helped the company do $70.3 million in sales, prosecutors said.
Lafarge had previously admitted bribes were paid after an internal investigation, but US Deputy Attorney General Lisa Monaco said that the company’s actions “reflect corporate crime that has reached a new low and a very dark place.”
She added that, “Business with terrorists cannot be business as usual.”
In a statement, Lafarge’s new owner Holcim said none of the conduct involved Holcim, “which has never operated in Syria.”
It added that former Lafarge executives involved in the bribery had concealed it from Holcim, as well as external auditors.
Eric Olsen, who was CEO between 2015 and 2017, stepped down from his role following an investigation into Lafarge’s activities in Syria.
The Department of Justice said that senior executives at Lafarge were involved in the arrangements and aware they risked running afoul of authorities.
Executives had attempted to require Islamic State not to include the name “Lafarge” on documents memorializing and implementing their agreements, and many involved in the scheme also used personal email addresses, rather than their corporate email addresses, to carry out the conspiracy, the Department said.
Lafarge executives also backdated the termination agreement to August 18, 2014, a date shortly after the United Nations Security Council had issued a resolution calling on member states to prohibit doing business with Islamic State, to falsely suggest that negotiations with Islamic State had not occurred after the UN resolution, the Department said.
The dealings by Lafarge were eventually made public in 2016 on a website run by a Syrian opposition group.
Breon Peace, US Attorney for the Eastern District of New York – where the case was brought – said the conduct “by a Western corporation was appalling and has no precedent or justification.”
“The defendants paid millions of dollars [to Islamic State], a terrorist group that otherwise operated on a shoestring budget, millions of dollars that [Islamic State] could use to recruit members, wage war against governments, and conduct brutal terrorist attacks worldwide, including against U.S. citizens,” he said at a press conference announcing the guilty plea.
Lafarge also faces charges of complicity in crimes against humanity in France over its activities in Syria, but the company denies the claims.
