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Brazil prosecutors probe Sweden’s fighter jet deal

A 39.3 billion kronor ($5.5 billion) deal signed by Swedish defence company Saab to build and sell 36 Jas Gripen fighter jets to Brazil is being investigated by Brazilian prosecutors.

Brazil prosecutors probe Sweden's fighter jet deal
Brazilian prosecutors are investigating a Saab deal. Photo: Magnus Hjalmarson Neideman/SvD/TT

The Brazilian federal government and Saab officially signed the contract in October, after a year of negotiations. The total price of the jets had then gone up by $900 million (around 8.3 billion kronor in today's exchange rate), which prompted Brazil's government secretariat to initiate a probe into why the bill had sky rocketed.

Saab press officer Sebastian Carlsson has confirmed that Brazil's public prosecutors are now investigating the purchase – but underlined that no suspicion of criminal activity has as of yet been announced.

“It is correct that there is a prosecutor now who is going to ask a few questions. In Brazil the possibility of reporting things and the right to have it investigated is very open to anyone. It is both common and expected that a report like this arrives,” he told Swedish public broadcaster SVT.

Brazil agreed in October to buy 36 Gripen NG fighter aircraft, including their related systems and equipment. The fleet will be comprised of 28 single-seat and eight two-seat Gripen NG which will be delivered between 2019 and 2024.

Saab CEO Håkan Buskhe explained on Brazilian television after the purchase that the higher price was due to the customer adding new requirements to the order during the process as well as fluctuating exchange rates.

“The contracts are signed in Swedish kronor, but Brazil is an oil economy where a lot is based on the dollar,” Carlsson told SVT.

According to Brazilian newspaper Folha de San Paulo, the entire deal could be annulled if the prosecutor discovers financial irregularities. But Saab said it welcomes a judicial investigation.

“This deal is probably the most transparent deal we have done. At the end of the day it is positive that there is the opportunity for the public to have their questions answered. It creates a feeling of security,” said Carlsson.

Saab is one of the world's leading defence and security companies and has around 14,700 staff around the world.

The company recently hit the headlines after it was initially excluded from a major new submarine-building programme in Australia.

The firm reported soaring annual profits in 2014 and forecast stronger arms sales this year in response to conflicts in Ukraine and the Middle East.

It sells the Carl-Gustaf rocket launcher used by US armed forces and this week announced a new multimillion dollar deal to help Norway update its core weapon detection radar system.

The Saab aerospace and defence company is not connected to Saab Automobile.

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CARS

Former Swedish Saab bosses appear in court

Swedish car maker Saab's former CEO Jan Åke Jonsson and the firm's former head lawyer Kristina Geers have appeared in court in Vänersborg in west Sweden, accused of falsifying financial documents shortly before the company went bankrupt in 2011.

Former Swedish Saab bosses appear in court
Saab's former CEO Jan Åke Jonsson. Photo: Karin Olander/TT
The pair are accused of falsifying the paperwork at the height of the Swedish company's financial difficulties at the start of the decade.
 
A third person – who has not been named in the Swedish media – is accused of assisting them by issuing false invoices adding up to a total of 30 million kronor ($3.55m).
 
According to court documents, the charges relate to the firm's business in Ukraine and the paperwork in question was signed just before former CEO Jan Åke Jonsson resigned.
 
Both Jonsson and Saab's former head lawyer Kristina Geers have admitted signing the papers but denied knowledge of the Ukranian firm implicated in the case.
 
All three suspects deny all the charges against them.
 

Saab's former head lawyer Kristina Geers. Photo:  Björn Larsson Rosvall/TT
 
Saab filed for bankruptcy at the end of 2011, after teetering on the edge of collapse for nearly two years.
 
Chief prosecutor Olof Sahlgren told the court in Vänersborg on Wednesday that the alleged crimes took place in March 2011, when Saab was briefly owned by the Dutch company Spyker Cars.
  
It was eventually bought by National Electric Vehicle Sweden (Nevs), a Chinese-owned company after hundreds of staff lost their jobs.
 
The car maker, which is based in west Sweden, has struggled to resolve serious financial difficulties by attracting new investors since the takeover.
 
In October 2014 it announced it had axed 155 workers, close to a third of its workforce.
 
Since 2000, Saab automobile has had no connection with the defence and aeronautics firm with the same name. It only produces one model today, the electric 9-3 Aero Sedan, mainly targeting the Chinese market.