Anti-corruption authorities in the United States and Sweden are reviewing a complaint alleging that the Swedish affiliate of a US company pledged to pay tens of millions of dollars in kickbacks if a son of Turkish President Recep Tayyip Erdoğan helped it secure a dominant market position in the country, according to a special report by Reuters published on Monday.
According to the documents seen by Reuters, Dignita’s plan was to gain Turkish government approval for regulations requiring the use of its dashboard breathalyzers, which disable a vehicle’s ignition when the driver is intoxicated. In exchange for a 10-year exclusivity agreement, Dignita agreed to pay tens of millions of dollars in lobbying fees to two institutions where Bilal Erdoğan serves as a board member. Ultimately, however, no kickbacks were paid, and the project was abruptly abandoned by Dignita late last year.
The US Department of Justice and the Swedish prosecutors received the complaint in April and launched preliminary investigations to determine whether provisions of US and Swedish anti-bribery laws were violated. The Foreign Corrupt Practices Act (FCPA) in the United States can establish a violation even without the exchange of money. Both countries consider the promise to pay commissions to be potentially criminal under certain circumstances. The preliminary probes may or may not lead to formal investigations or indictments.
Dignita’s US owner, 1A Smart Start LLC, confirmed the termination of the project, saying it learned of “potentially concerning conduct” in Turkey that led to the termination of several individuals involved. Apollo Global Management, one of the world’s largest asset managers and the parent company of 1A Smart Start, referred questions about its alleged role to Smart Start, which clarified that it had not conducted any business in Turkey and had ceased pursuing opportunities in the country.
The allegations come at a sensitive time for bilateral relations between Turkey and Sweden, as Turkey recently blocked Sweden’s attempt to join NATO, accusing the Nordic country of harboring alleged terrorists. The investigation into Dignita’s Turkish efforts further strains already tense relations between the two nations.