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Siemens to Pay $800m fine in bribery probe

08 January 2009 14:13 (UTC +04:00)

Baku. Aynur Veliyeva â€“ APA-Economics. German engineering company Siemens AG and U.S. authorities are expected to settle a longstanding bribes-for-business investigation Monday with a record $800 million fine -- almost 20 times higher than the largest previous penalty under the U.S. Foreign Corrupt Practices Act, reported The Wall Street Journal.
Under the accord between Siemens and the Justice Department and SEC, the company will admit inadequate internal controls and doctoring its books. But it wonâ€™t formally plead guilty to bribery charges. That will allow it to keep bidding for public-sector infrastructure projects in the U.S., according to people familiar with the matter.
The SEC claims Siemens made at least 4,283 bribe payments totaling $1.4 billion alone between March 2001 and September 2007. Misconduct was "systematic" and involved "employees at all levels of the company, including former senior management," the SEC said in a court filing.
The filing details alleged bribes to government officials in 10 countries, including payments to supply transit systems in Venezuela; medical equipment in China, Vietnam and Russia; power equipment in Iraq and Israel; refineries in Mexico; and telecommunications equipment in Nigeria and Bangladesh.
It accuses Siemens of paying more than $40 million in bribes to senior government officials in Argentina between 1998 and 2004 to try to secure a contract to make national identification cards. Illicit payments included "at least $2.6 million" in 1998 and 1999 to Mr. Menem, who was Argentinaâ€™s president at the time, and two other senior government officials, according to the SEC filing. Mr. Menem has in the past denied illegal payments from Siemens.
U.S. prosecutors claim Siemens employed several methods to conceal bribes, including sham consulting contracts. The Justice Department also claims that Siemens used "removable Post-It notes" with affixed signatures to obscure audit trails and "cash desks" where employees could fill "empty suitcases" with as much as â‚¬1 million ($1.3 million) to pay bribes.