August 28, 2008

US justice department launches probe of Alcoa

It is reported that US Department of Justice has launched a criminal investigation into whether Alcoa Inc, one of its subsidiaries and people connected with the unit committed fraud, corruption and bribery in its relations with customer Aluminum Bahrain BSC.

In a motion filed recently with the US District Court in Pittsburgh, the Justice Department asked the court to put a temporary hold on a Alba's civil suit against Alcoa, the world's largest supplier of alumina, the principal raw material used in making aluminum. The suit also names affiliate Alcoa World Alumina LLC, Mr William Rice former Alcoa World Alumina Vice President of Marketing and Mr Victor Dahdaleh an agent of Alcoa and Alcoa World Alumina as defendants.

The department wrote in its motion that "The Alba complaint alleges numerous facts which, if true, could be relevant to the government's criminal investigation and a potential criminal trial."

Mr Kevin Lowery spokesman of Alcoa said that Mr Rice is an Alcoa employee, Mr Dahdaleh is not. He said "We did not object, and we also told them we would be cooperating fully, partly because we see this as opportunity to get speedy resolution to the entire matter. We have continued to look into the matter and have yet to find that Alcoa hasn't lived up to its values."

Alba which is 77% owned by the government of Bahrain also accuses the defendants of overcharging it for alumina. It did not name the official to whom bribes were allegedly paid.