Many people believe that the death of Ottavio Quattrocchi will effectively put the lid on the Bofors scandal, and consign the issue to the dustbin of history. They are mistaken. Closure will come when truth is out
The news of the demise of Ottavio Quattrocchi, the Italian businessman and close friend of Sonia and Rajiv Gandhi, has prompted some people to say that with his passing, the Bofors kickbacks scandal is laid to rest. To put it mildly, this is wishful thinking.
So many in the dramatis personae of the Bofors Saga are no more. Rajiv Gandhi, Martin Ardbo (president of Bofors when the deal was signed and whose diary entries gave vital clues to the Swedish police), former Defence Secretary SK Bhatnagar, Win Chadha, the company’s agent in India, and now Ottavio Quattrocchi. With the passing of each of these individuals, commentators speculated that the scandal will die a natural death. But, no such thing has happened. And the reason for this is simple: The people of India know that certain persons in power knocked off commissions and bribes while finalising the contract with the Swedish arms manufacturer for supply of field guns. They also know that nobody was punished for these offences.
Although Congress-led Governments at the Centre have tried to bury the scam, there were independent investigators and institutions in the country, including the media, which felt duty-bound to put the facts in the public domain. One such institution was a Delhi Bench of the Income Tax Appellate Tribunal. Even as the CBI responded to its master’s voice, this Tribunal did the most detailed examination of the involvement of Ottavio Quattrocchi as a middleman in the Bofors payoffs scandal. Some key points made by the Tribunal are worthy of mention here:
Ottavio Quattrocchi remained in India from February 28, 1965 to July 29, 1993, except for a brief interval from March 4, 1966 to June 12, 1968. He was a certified chartered accountant by profession, working with Snamprogetti, an Italian multinational company, but “neither Snamprogetti nor Ottavio Quattrocchi had any experience of guns, gun-systems or any related defence equipments”.
The Tribunal noted that despite the Indian Government’s policy against suppliers hiring agents, Bofors entered into a fresh consultancy agreement with a company called AE Services limited, UK, on November 15, 1985, at the behest of Ottavio Quattrocchi. An extraordinary aspect of this deal was that Bofors committed itself to pay this company three per cent of the total value of the contract only if the Indian Government awarded it the contract by March 31, 1986 (that is within 137 days of the signing of the contract on November 15, 1985). This was indeed an extraordinary stipulation and a tough deadline to meet specially when it concerned a major international weapons deal. But what was even more extraordinary was that Ottavio Quattrocchi met that deadline! The Rajiv Gandhi Government signed the deal with Bofors on March 24, 1986 — just a week before the deadline set by Bofors was to expire.
After signing the contract with Bofors, the Indian Government released the first tranche of payments to Bofors which was equivalent to 20 per cent of the contract value on May 2, 1986. Once it received the first tranche, Bofors remitted US$7.343 million on September 03, 1986, to A/c No 18051-53 of AE Services limited at Nordfinanz Bank, Zurich. This worked out to exactly three per cent of the advance payment made by India. Thereafter, the Tribunal recorded the money trail, as tracked by the investigators, in detail. From Nordfinanz Bank the money was transferred to Account No 254.561.60W of Colbar Investments limited (a company registered in Panama) in the Union Bank of Switzerland, Geneva in September, 1986. From this account, again the funds were moved to Account No 488.320.60 X of a company called Wetelsen Overseas, SA in the same bank in July 1988. Thereafter, the funds were once again moved to Account No. 123983 of International Investments Development Company in Guernsey (Channel Islands) in May 1990. The ITAT said on the basis of records before it that “these Accounts of Colbar Investments as well as Wetelsen Overseas were being controlled by Ottavio Quattrocchi and his wife Maria Quattrocchi”.
In the final analysis, the tribunal noted that Win Chadha and Ottavio Quattrocchi had been transferring the funds received from Bofors frequently from one account to another and from one jurisdiction to another to avoid detection and to obliterate the money trail.
In the final analysis, Bofors paid out the equivalent of 243 million Swedish kroners as commission to Ottavio Quattrocchi and Win Chadha. But the most extraordinary development was that AE Services unilaterally announced that it would forego the rest of the commission due to it from Bofors, after the kickbacks scandal broke out in April 1987.
Strangely, despite this clinching evidence of Ottavio Quattrocchi getting commissions from Bofors, Prime Minister Manmohan Singh ensured the defreezing of Ottavio Quattrocchi’s bank account by the UK Government and ordered the CBI to withdraw the case against him. People also recall how Ms Gandhi protested angrily at a Press conference at the Congress headquarters some years ago and asked, “Where is the proofIJ Show me the proof”, when a correspondent asked her how Ottavio Quattrocchi got paid when we bought guns from Bofors. Ms Quattrocchi has been saying much the same thing. But these loud protestations will not help.
No financial or bribery scandal will fade out of public memory unless there is adequate reparation for the losses suffered by the exchequer. Unless this happens, a scandal is deathless. It will linger in the public mind and will be passed on, possibly with some embellishments, from one generation to another. While this is generally the case, it is more so in cases concerning a nation’s security. The taking of bribes or commissions when we buy guns for our soldiers is deemed an act of treachery (desh droh) and is never forgotten. Meanwhile, despite this clinching evidence of the money trail, Ms Quattrocchi is fooling nobody by claiming that her husband was “hounded for over 20 years” over the kickbacks issue.
The key figures in this scandal are all dead and they have gone unpunished. In this scenario, there is only one situation in which the Indian public conscience can be appeased. That is when the Quattrocchis accept the truth that they got payments from Bofors when we bought guns for our Army and return the money to the people of India. This could create an incentive for the people to forget the scandal. Until they do that, the ghost of Bofors will continue to haunt the Quattrocchis and those for whom they batted all these years.