A third former Leighton executive has quit his current post because of an alleged connection to the construction giant’s bribery scandal.

Russell Waugh, the engineering chief at UGL, has mutually agreed with the company to step down immediately.

He was appointed to the position only three weeks ago, as UGL, a $1.3 billion company, prepares to demerge its engineering and property businesses.

Among the allegations levelled against Leighton is that it paid bribes to win overseas contracts.

Mr Waugh ran Leighton’s oil and gas construction business in India, and established Leighton International’s offshore oil and gas business.

He has been accused of knowing about alleged corruption within Leighton International.

UGL and Mr Waugh said the decision for him to stand down was made in the interests of UGL, its clients and shareholders.

“I continue to strenuously deny all allegations made about me and reported recently in the press,” Mr Waugh said in a statement.

“The allegations are based on rumour and hearsay and do not stand up to any serious scrutiny.

“I will continue to take steps to restore my reputation and good standing.”

UGL said it was best for Mr Waugh to step down in order to privately defend the allegations made against him.

“This decision is not reflective of any view held by UGL on the allegations made against Russell Waugh during his tenure with Leighton,” it said.

Earlier this week, former top Leighton executives David Stewart and David Savage stepped down from British firms Laing O’Rourke and Keller, also due to allegations they knew of improper conduct at Leighton.

Mr Waugh left Leighton in August, 2012.

The Australian Federal Police is investigating potential corruption within Leighton International, after the company alerted it to potential breaches of its code of ethics.

UGL shares gained 23 cents, or 3.0 per cent, to $7.83 and Leighton shares added 44 cents, or 2.5 per cent, at $17.79.