Ex-Bechtel VP Pleads Guilty to Federal Kickback Charges

A former Bechtel Corp. vice president has pleaded guilty to federal charges that he took $5.2 million in kickbacks on electric-power contracts in Egypt over a 15-year period, the Dept. of Justice has said.

Asem Elgawhary, 73, a former Bechtel principal vice president, pleaded guilty on Dec. 4 in federal district court in Greenbelt, Md., to one count each of mail fraud, conspiracy to engage in money laundering and interfering with administration of tax laws.

Elgawhary’s attorney did not immediately reply to an ENR request for comment.

DOJ said that, from 1996 to 2011, Elgawhary was general manager of Power Generation Engineering and Services Co. (PGESCo) a joint venture of Bechtel and Egypt’s government-owned electric-power company, Egyptian Electricity Holding Co.

DOJ said that Elgawhary admitted he had accepted $5.2 million from three unnamed power companies or their consultants, which paid the money “to secure a competitive and unfair advantage” in bidding for power contractors.

According to DOJ, Elgawhary said he tried to use offshore bank accounts to conceal the kickback plan.

He also sent documents to Bechtel executives and PGESCo board members in Maryland that he had no knowledge of fraud or suspected fraud at PGESCo and that there were no violations of statutes or regulations that should have been considered for being disclosed in that company’s financial statements, DOJ said.

The department added that Elgawhary said that “in further attempt to conceal the scheme, he made misrepresentations to counsel for Bechtel” during a 2011 interview.

Charlene Wheeless, Bechtel principal vice president and global manager of corporate affairs, said in a statement: “The actions of this one individual are egregious and disheartening.”

She added: “Bechtel does not tolerate unethical behavior. We took swift action with the matter, launching a comprehensive investigation with the help of outside counsel and contacting the United States Dept. of Justice.”

Elgawhary, who has dual U.S. and Egyptian citizenship, was arrested on Nov. 26, 2013, and indicted on Feb. 10, 2014.

His sentencing is scheduled for March 23, 2015.

Tom Ichniowski has been writing about the federal government as ENR’s Washington Bureau Chief since the George H.W. Bush administration, and he has covered at least five major highway bills. A recognized expert on government policy on infrastructure and regulation, Tom is also a Baltimore native and Orioles fan who grew up rooting for Brooks and Frank Robinson. He is a graduate of Columbia College and Columbia’s graduate school of journalism, where he once used “unrelentless” in a headline.

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