Thursday, 16 August 2012
Italian Helicopter's Washington PR office flirts with Linked In to find Canada PR experts
ORNGE YOU GLAD YOU FOUND ME HERE IN CANADA THROUGH LINKEDIN?
By Stephen Weir
It was the promise of American money dropping into my lap that got my attention. All I had to do, the LinkedIn messages suggested, was to help a US based lobby group protect the reputation of an Italian helicopter manufacturer that could soon be in the cross-hairs of the Ontario Provincial Progressive Conservative Party and the Toronto Star. Piece of cake!
The Italian company has sold helicopters to the province’s Ornge Air Ambulance operation at a possibly inflated price and people want to know why. At stake? AgustaWestland’s ability to sell Italian made military helicopters in Canada and the United States.
It is a great assignment for someone like me. A little background: Three months ago Dan Hill, Washington Lobbyist for AgustaWestland helicopter (European military / civilian manufacturer) made contact. I gave him a price, a suggested plan of action. He then disappeared ... all in a coupla weeks.
Recently the same Dan Hill was quoted on the front page of the Toronto Star demanding that AgustaWestland get its money back from the Province. As well the company carpet-bombed the city with full-page advertisements in at least two daily newspapers. His firm has decided to go it alone long distance from Washington.
I don't advertise. I don’t work for people I don’t know. But I was intrigued by the out-of-the blue LinkedIn poke (it is Facebook for business people). I have a long history promoting aerospace products including the cruise missile, low level air defense tanks, small aircraft carriers (seriously) and I did in fact work on a marketing campaign for a component that went into AgustaWestland Cormorant helicopters purchased by the Canadian Forces. Oh yes, and over the years I have written a number of articles for the Toronto Star.
Agusta's Washington PR agency found me. They phone feted me. They heard what I had to say. They dropped me. Forget about polite no thanks; Agusta hasn’t LinkedIn to Emily Post.
What is at stake? Everything, but at the same time, not much here in Canada. There are no new helicopter ambulance buys in the offing right now (in fact the Province is trying to sell two of the 12 AgustaWestland helicopters that it had originally bought). There will be a requirement for shipboard helicopters if the Federal Government builds more frigates and patrol ships for our navy and the Coast Guard. But that is years away, and funding for the ship-based helicopters could take a backseat to the ballooning cost of the F-35 buy.
No, the real concern is how the Ornge debacle will play out in an ongoing OPP forensic investigation. If the Italian maker is found to have made untoward payments to the non-profit Ornge ambulance service, a directly related for-profit Ornge Peel marketing company and an Ornge registered charity, it could trigger serious legal problems in the United States. The word kickback has been uttered at an ongoing government hearing that the Province is holding. It appears to me that they want to know if AgustaWestland willfully over-charged for the air ambulance choppers and then invested-back/donated the price difference paid - some 6 to 8 millions dollars - to the Ornge Peel marketing company and the charity.
Ornge Peel has been shut down with little to show for the millions invested. The charity is dormant. Agusta, this month, has asked for its money back. Presumably Conservative MPPs dogging the government over the helicopter purchase will be asking AgustaWestland for a rebate on the perceived overpayment.
According to testimony given by Ornge executive Steve Farquhar at the ongoing Provincial Government Hearings, the AW 139 helicopters were actually bought in the United States - meaning that if police turns up fraud, AgustaWestland will likely have to be concerned about the American Foreign Corrupt Practices Act.
Under this act companies found guilty of kickbacks and bribery charges outside of the country can also be prosecuted in the US! Even though the Ornge deal was between an Italian company and an agency of the Province of Ontario, because some of the actual financial transactions took place in the US, the FCPA’s onerous penalties could come into play.
It won't be the first time that the US Government has tackled offshore bribery charges. A recent Reuters story details the case of Siemens, a Germany based electronics giant. "In December 2008, Siemens and its subsidiary in Argentina pleaded guilty to criminal violations of the U.S. Foreign Corrupt Practices Act and paid $449 million in fines over a" bribe filled contract between the German company and the Argentine government,“ reported Reuters. "The case was filed in New York because the former executives took part in meetings in the United States and used U.S. bank accounts"
Time Magazine says that, as of 2012, there are currently about 150 Foreign Corrupt Practices Act investigations under way, some of which target foreign firms. Company officials face high fines and possible jail sentences. Firms risk being barred from bidding for US military contracts.
According to NDP MPP Taras Natyshak, Finmeccanica, AgustaWestland's parent company "is facing a probe in India over financial irregularities involving a €560-million purchase of 12 helicopters. An Italian investigation into corruption in 2011 forced the chairman of this helicopter company to resign."
The company is also being probed in Rome about an alleged slush fund to funnel money to political parties. As well, the company's new CEO, Giuseppe Orsi, (pictured at a Toronto Island Airport photo op) has been questioned in the Italian press about a helicopters-for-Maserati luxury cars deal. The high performance autos are reportedly for the use of company officials.
Here in Ontario, the ongoing Provincial Government Hearing is in summer recess but will resume in the fall. The Ontario Provincial Police continue to investigate the case. If need be, the RCMP can be brought in under the Federal Corruption of Foreign Public Officials Act (CFPOA). The Royal Canadian Mounted Police (RCMP) has established a special unit dedicated to investigating international bribery and enforcing the CFPOA.
The Ornge investigation is off the front pages for the summer and the $30,000 full page ads appear to have been parked in their US hangar for now. The PR team in Washington has time now to evaluate what they have accomplished.
They have skillfully tried to position AgustaWestland as the victim. They are saying the company has followed the letter-of-the-law in selling a great helicopter to the people of Ontario. Their ads have stressed the reliability of their products.
However, Toronto is not Washington. Agusta need pin stripes on the ground – senior company officials (and PR voices) willing to meet the Toronto Star, the opposition politicians and the OPP on Canadian soil. Having a Beltway vet simply phone it in has a certain Yankee patronizing smell that Canadian reporters have long come to despise.
And the full page ads? At $30,000 a pop, they are spending major money to say nothing about the questions that are being raised at Queens Park by important (and trustworthy) Canadians. I am sure the newspapers publishers are pleased at AgustaWestland’s expensive advertising campaign. But, in the newsrooms? Those ads have as little chance in influencing their future stories as an Ornge chopper flying through the eye of a needle.
What would I do to help AgustaWestland avoid the coming dung storm? Ornge you glad I am on LinkedIn?