Leighton's losses over scandal may top $500m Plummeting. Leighton Holdings' losses stemming from alleged corrupt activities in its offshore operations could amount to more than $500 million, including a potentially hefty fine, analysts have warned. Brokerage Deutsche Bank said the "reputational damage" stemming from the bribery scandal - sparked by stories published by Fairfax Media this week - may "limit the amount of future work awarded to Leighton" or lead to cancelled contracts, and could result in a 20 per cent, or $46 million, hit to Leighton's offshore revenues. With the company's shares plummeting for a second day - almost $1 billion was wiped from the construction major's market value in the past two days - Deutsche warned that Leighton may also have to write off a $400 million debt it believes the company is still owed from an oil pipeline project in Iraq at the centre of some of the bribery allegations. Leighton shares closed 80¢, or 4.6 per cent, lower on Friday to $16.74, having already dropped more than 10 per cent on Thursday. In a note to clients, Deutsche said Leighton could also face a fine of up to $57 million under the Commonwealth Criminal Code, as well as a shareholder class action. With the potential fine, lost revenue and debt impairment, Deutsche estimated Leighton could be forced to write down as much as $562 million, not including any class action-related losses. But the bank said it did not expect the scandal to have a "material" impact on Leighton's Australian operations, "as they are managed separately from where the alleged kickbacks occurred." Leighton's Asia and Middle East division accounted for about 17 per cent of the group's $23.1 billion revenue in 2012. It also said that although the potential losses may lead to Leighton breaching its debt covenants, it believed this was unlikely, with the estimated write-downs of up to $562 million too small to force a breach. Law firm Maurice Blackburn, which is investigating a shareholder class action against Leighton Holdings, said the drop in Leighton's share price meant the market had "clearly" been surprised by the "serious corruption allegations." "We are currently investigating the impact of these allegations on both the scope of our clients' current class actions and the length of the claim period," said special counsel Jenny Tallis. Analysts at JPMorgan said the allegations were a reminder of Leighton's "legacy" issues. In a note to clients, the bank noted that if Leighton was charged and found guilty "it could incur financial penalties and enforceable undertakings to address any shortcomings." "[Leighton] could also face reputational damage and, in certain circumstances, find it more difficult to bid on work if clients deem that the group is unfit," JPMorgan said. But we believe these risks are small at this stage until the AFP reveals its position. Stories published by Fairfax Media this week revealed allegations that the firm's international operations in Asia and the Middle East were "rife with corruption, bribery and malfeasance," and that its directors oversaw a "dramatic failure in governance" that enabled corruption. The reports come two years after Leighton alerted authorities that it may have breached foreign bribery laws in Iraq, a matter under investigation by the Australian Federal Police. In a statement to the Australian Securities Exchange on Thursday, Leighton said it took the allegations seriously. It said it was co-operating with the AFP's investigation into the Iraq matter. It said it was not aware of new allegations of breaches of its ethics, and said its directors had acted with appropriate care and diligence at all times.