At Siemens, Bribery Was Just a Line Item

Source: Herald Tribune

To understand how Siemens, one of the world’s biggest companies, last week ended up paying $1.6 billion in the largest fine for bribery in modern corporate history, it’s worth delving into Mr. Siekaczek’s unusual journey.

. . .

What is striking about Mr. Siekaczek’s and prosecutors’ accounts of those dealings, which flowed through a web of secret bank accounts and shadowy consultants, is how entrenched corruption had become at a sprawling, sophisticated corporation that externally embraced the nostrums of a transparent global marketplace built on legitimate transactions.

Mr. Siekaczek says that from 2002 to 2006 he oversaw an annual bribery budget of about $40 million to $50 million at Siemens. Company managers and sales staff used the slush fund to cozy up to corrupt government officials worldwide.

. . .

Three decades after Congress passed a law barring American companies from paying bribes to secure foreign business, law enforcement authorities around the world are bearing down on major enterprises like Daimler and Johnson & Johnson, with scores of cases now under investigation. Both companies declined comment, citing continuing investigations.

Albert J. Stanley, a legendary figure in the oil patch and the former chief executive of the KBR subsidiary of Halliburton, recently pleaded guilty to charges of paying bribes and skimming millions for himself. More charges are coming in that case, officials say.

Read more: http://www.heraldtribune.com/article/20081221/ZNYT01/812213013?Title=At_Siemens__Bribery_Was_Just_a_Line_Item

:think:

but bribery and corruption are just 'business as usual' in much of the world.

their nations with bribes. Siemans is being sued by Africa for over five years for this exact same thing.

And what do you mean bribes are not legal here? What about K Street and all the lobbyist money bulging in Congresscritters' pockets? Billions are spent here annually on bribing politicos. We call it lobbying.

Other nations are more honest and call it bribes.

..their prospective customers.

but they're complicit in the bribery.

My first hand experience is in the grain trade. We'll load a ship with aid cargo, given free to the receiving country. Bribes still have to be paid to government authorities, local port authorities, and even the stevedores to get the stuff unloaded to feed their hungry population. The shipping companies have an 'expditer' who is essentially a black bag man to hand out a little walkin' around money to make sure the ship gets unloaded. It's not very different in parts of Central and South America and parts of the Far East, either.

Here it's not bribery-it's "speech." I'm with you on the honesty part, though.

the people who we were taught to 'look up to', the Captains of Industry.

Give me a minute and let me see if I can find the article where Kenny Boy Lay told a bunch of kids that if they worked hard they too could grow up to be rich and famous and ride corporate Lear jets, just like him. Nope, can't find it now.

Anyway, the rich and famous are supposed to be sooooooooo special. And I agree. The richer you are, the bigger the sin you can afford.

but or "trusted" government officials are typically on the receiving end of the these payments. Absolute power corrupts.

When did this Siemen story first break?

I can tell you that most fortune 500 companies have fairly strong programs for Foreign Anti-Corruption Act policies. There are still violations, but the problem is that US companies are competing against European ones where basically bribery is widespread. French and Italian businesses continue to conduct business in the third world through bribery.

As to who is at fault? Well, who is at fault, the briber or the bribee? The African nations are just as at fault, as there is widespread corruption and gov't officials see their stay in gov't as a chance to sock away fat amounts of money.