Former Leighton executive David Savage pleads guilty to covering up bribes, receives paltry $1000 penalty
An architect of Australia’s longest-running corporate bribery scandal has been fined $1000 for covering up the payment of $45 million to corrupt Iraqi politicians, a penalty described as “embarrassing” by corruption experts.
David Savage, former chief operating officer of Australian infrastructure giant Leighton Holdings, pleaded guilty in a Sydney court on Thursday to misleading the company’s board when he sought to conceal the bribes in 2011.
Savage, who Commonwealth prosecutors charged not with bribery but less serious Corporations Act disclosure breaches, was convicted in the Downing Centre local court and ordered to pay a $1000 fine – allowing him to return to his French estate a free man.
Anti-corruption advocates attacked the sentence, as did one of the corporate whistleblowers who in 2013 helped reveal Leighton’s corruption affair, which ultimately morphed into a global graft scandal that resulted in companies such as Rolls-Royce paying more than $1 billion in fines and led to the jailing of businessmen in the UK and United States.
Savage’s court penalty was slammed by leading corruption advocate Clancy Moore, of Transparency International, along with one of the corporate whistleblowers who helped expose the Leighton affair, veteran businessman Stephen Sasse.
“This minuscule fine for a huge multimillion dollar bribery scandal is embarrassing and sends the wrong message to Australian businesses working in high-risk industries like infrastructure and mining,” said Moore, who also stressed that recent anti-corporate corruption reforms were failing.
Sasse said the penalty was “ludicrous”.
In contrast to Savage’s $1000 penalty, an Iraqi middleman who helped distribute some of the $45 million paid in bribes by Leighton Holdings to secure a $1 billion oil pipeline project was jailed in the UK in late 2020 for three years and four months for his corrupt dealings.
In 2023, another corrupt fixer used by Leighton to pay bribes, Monaco businessman Saman Ahsani, was sentenced to 12 months in a US prison and ordered to forfeit $2 million for his role in the scandal.
The conclusion of the case against Savage follows more than a decade of scrutiny and criticism of the Australian Federal Police and the Commonwealth Director of Public Prosecutions for their patchy record in combating corporate graft.
But the struggle of Australian authorities to uncover and penalise bribery by large companies is not unique. British authorities have a similarly poor strike record, while the once-powerful US corporate graft-busting agencies have largely been redirected to pursue other priorities by the Trump administration.
The Australian Federal Police began investigating Savage in 2011, spending millions on what became the agency’s most significant and exhaustive corporate crime probe.
Savage had made his career and fortune with ASX-listed giant Leighton (now named CIMIC), becoming one of the firm’s most influential executives and consigliere to its long-serving chief executive, Wal King. Both Savage and King left the firm in 2011 and there is no suggestion King knew of or was involved in any wrongdoing.
Company records reveal Savage collected $18 million from Leighton between 2007 and 2011 as the firm won many of Australia’s largest infrastructure projects while aggressively expanding into Asia and the Middle East.
In the year he covered up the bribery plot, Savage earned $2 million in salary and bonus payments, enabling him to purchase the French estate that he now calls home and which was once the residence of the grandson of the king of Spain.
Senior AFP officer Timothy Underhill said in a statement that Savage’s offending involved him failing to tell Leighton’s board that the company was paying tens of millions of dollars to middlemen in Iraq, an obvious indicator of bribery.
“Omitting details about the use of agents compromised the integrity of Leighton’s corporate governance because it deprived the directors of the opportunity to ask appropriate questions,” acting commander Underhill said.
“Boards should be notified when foreign agents are being used so that they can ask questions and ensure due diligence has been undertaken.”
Underhill’s statement did not address Savage’s court fine, but stressed that the federal agency “remains committed to investigating offences that undermine strong corporate governance”.
“The dedication and professionalism of our officers is evidenced by the fact they pursued this investigation for 10 years,” he said.
Commonwealth barristers are separately prosecuting a bribery case against a second former Leighton executive implicated in the Iraq scandal.
Transparency International’s Moore said the Savage case was “another sad example of how Australia’s laws are failing to hold the corrupt to account”, and called for the introduction of a deferred prosecutions agreement scheme that would encourage firms to self-report corruption in return for leniency.
Privately, federal police officers also support the strengthening of corporate corruption laws and the introduction of a deferred prosecutions agreement scheme.
“Australia’s new foreign bribery regime should be working as a big stick for companies who do the wrong thing, but we’re yet to see any results,” said Moore.
“With a review later this year of the laws, it’s time to include a ‘carrot’ through the introduction of a deferred prosecutions agreement scheme.”
Sasse, a former senior Leighton executive who assisted the federal police with its investigation into the firm, warned the outcome risked sending a message to whistleblowers that co-operating with authorities was not worth the risk.
“This investigation and prosecution has taken far too long and the penalty provides no incentive for businesses to do the right thing,” said Sasse. “I’ve paid more in speeding tickets.”
Leading corporate lawyer Robert Wyld, who specialises in advising firms on corruption risks, said that while the AFP’s investigators were tireless and had improved aspects of the agency’s anti-bribery operations, the Commonwealth’s track record showed the system was not working.
“It means that for those in business doing the wrong thing, some will take an educated guess to keep doing the wrong thing because it pays off,” Wyld warned.
“A lot of companies are not reporting bribery and corruption because there is no obligation or incentive to do that. It is pretty limited. If anything is going on, there is no sense of public awareness and there is no sense that if I get caught, I will get punished.
“The AFP has its hands tied behind their back,” said Wyld, who also called for the introduction of deferred prosecutions agreements.
Court files obtained by this masthead reveal that the federal police discovered emails in which Savage instructed a fellow Leighton executive in 2010 to “amend” internal company records to conceal bribe payments.
“Obviously, we need everything in the ‘right’ place,” Savage said in one email, referring to the need to ensure certain large payments that might raise board suspicions were “buried”.
The police court files also contain stunning admissions of bribery from the flamboyant owners of the Monaco firm Unaoil, the Ahsani family, which paid bribes on behalf of Leighton.
The Ahsanis were Monaco millionaires and members of the global elite who rubbed shoulders with princes, sheikhs and the cream of European and American society.
Leaked emails obtained by this masthead in 2015, which helped the AFP bring its case against Savage and also led to the Ahsanis being charged by the FBI, showed how the multimillion-dollar fees Unaoil took from its many large corporate clients were funnelled into an industrial-scale global bribery operation.
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Nick McKenzie is an Age investigative journalist who has three times been named the Graham Perkin Australian Journalist of the Year. A winner of 20 Walkley Awards, including the Gold Walkley, he investigates politics, business, foreign affairs and criminal justice.Connect via email.
