Chemical firm fined £8.3m over bribes in Indonesia

Innospec, which has offices in Cheshire, prolonged the use of harmful lead-based fuel in Indonesia by giving corrupt payments totalling more than $8.5m (5.6m) to local officials.

The firm was fined at Southwark Crown Court yesterday following a controversial transatlantic plea bargain.

Sentencing judge Lord Justice Thomas said the fine was "wholly inadequate" but he did not want to make the company insolvent, affecting its innocent employees.

He also said the director of the Serious Fraud Office had no power to enter into the arrangements made and no such arrangements should be made again.

Sitting last week, Lord Justice Thomas said: "To mark the gravity of corruption of a foreign government, massive fines seem to me to be absolutely essential."

The plea agreement was the culmination of more than two years of transatlantic negotiations between the UK's Serious Fraud Office (SFO), the US Department of Justice, the US Securities and Exchange Commission and Innospec.

The deal earmarked $40.2m (26.3m) as being available for fines and confiscation. About two-thirds of this sum is set to go to US authorities.

Innospec is thought to have benefited to the tune of $770m (505m) as a result of the bribes that were paid out between February 2002 and December 2006.

The payments were in relation to the supply of the firm's anti-knock fuel additive Tetraethyl Lead (Tel), a major source of income for the company before health and environmental concerns led to its withdrawal in the US and Europe by 2000.