Illinois aviations services provider AAR appears close to resolving bribery allegations involving the sale of used Airbus A330s at inflated prices to the Nepal Airlines, the flag carrier of Nepal.
A July 19 plea deal reached by Deepak Sharma, former President of International Supply Chain for AAR was usealed in the District of Columbia. Sentancing is forthcoming.
On April 4, Nepal’s anti-graft body completed its five-year probe into the $209.6-million Airbus deal, the largest ever in Nepal’s aviation history. The body concluded that Nepal Airlines' procurement of two wide-body jets caused the government a loss of $13.38 million. The case has implicated 32 individuals.
In December 2016, Nepal Airlines selected a group consisting of AAR Corp, German Aviation Capital of Germany and Hi Fly (airline) of Portugal the purchase of two widebody aircraft. The month before, Sharma had sent a text messageto a conspirator stating “I am having dinner with head of evaluation committee now. We are discussing how to throw others out even if they come below our bid. See you tomorrow.”
In an SEC filing in July 2019 AAR Corp reported that it had self-reported the results of an investigation by outside counsel of possible violations of the Foreign Corrupt Practices Act and the company’s code of conduct in South Africa and Nepal. The company said that it had contacted the US Department of Justice, the US Securities and Exchange Commission and the UK Serious Fraud Office, and would fully cooperate with the authorities in their review of the matter.
On June 11, the DOJ charged Julian Aires, President of JM International with conspiring to violate the FCPA's anti-bribery provisions. The case was unsealed on July 15 following a plea agreement. South Africa's Zondo Commission of Inquiry found that between January 2016 and January 2020, Aires and co-conspirators bribed South African officials to secure and maintain a five-year contract for a joint venture between JM International and AAR Corp, to provide components and repair services to South African Airways Technical (SOC) Ltd. a full-service MRO organization, the largest in Africa.
In July 2021 AAR Corp and its subsidiary, AAR Airlift Group Inc. (Airlift) agreed to pay the United States $11,088,000 to resolve allegations that they violated the False Claims Act in connection with aircraft maintenance services performed by Airlift on two United States Transportation Command (USTRANSCOM) contracts.
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