Leighton sued by alleged bribed middleman

THE alleged middleman in the Iraqi bribery scandal that engulfed Leighton executives is suing Leighton for $US33.3 million ($A35.16 million) over what it says is a construction dispute.

Fairfax Media reported that Monaco-based company Unaoil - which was allegedly paid a $42 million kickback by Leighton to win a $750 million oil pipeline contract in Iraq - filed a lawsuit in the Hong Kong High Court against the construction giant.

Unaoil general counsel Paul Bayley told the media group the case had nothing to do with the bribery allegations and was a standard construction dispute over cost increases that resulted in changes to the design of underwater oil pipelines.

"Unaoil contends such design changes are outside the original scope of work and Leighton believes the changes are within the original scope," he reportedly said in an email.

"This is a highly technical issue and it has absolutely nothing to do with the investigation.

"If anything, it underpins the strictly legal and transparent relationship between Leighton and Unaoil."

Last week Unaoil issued a statement saying it categorically denied any allegation of improper conduct in its work with Leighton.

A note uncovered by Fairfax Media and written by former Leighton CEO David Stewart contradicted this statement, claiming Unaoil was paid kickbacks by Leighton via an inflated $87 million contract of which the value of "real work" was less than half.

When asked for comment on the Hong Kong court case, Leighton told CIN it did not comment on matters before the court.

The court case adds to the many worries Leighton is facing, both from some of its shareholders and the Australian Federal Police.

Last week law firm Maurice Blackburn served a legal letter notifying Leighton of its proposal to begin a class action on behalf of some of its shareholders, seeking to recover more than $1.1 billion in losses they suffered as Leighton allegedly failed to disclose allegations of bribery, corruption and investigated misbehaviour when they bought shares in the company in 2010-11.

The class action comes on top of a writ issued two weeks ago by the Supreme Court of Victoria against Leighton, following revelations by the Fairfax Media investigation that Leighton directors approved a culture of bribery to win international contracts.

The AFP is investigating the alleged bribery cases and its perpetrators.

Allegations that former Leighton management knew and approved of a kickback culture already led some heads to roll, with former top Leighton executives David Stewart, David Savage and Russell Waugh losing their current jobs.

Stewart resigned as chief executive of UK contractor Laing O'Rourke's Australian business last week, while Savage stepped down from the board of UK engineering group Keller.

Both were found to allegedly allow bribery at Leighton.

Savage's signature was found on a preliminary tender document that included the alleged $42 million kickback paid to Unaoil.

Fairfax Media reported that Waugh, who allegedly negotiated the kickback, left as head of Australian construction firm UGL's $2.3 billion engineering business last Friday, after only one month in the job.


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