Siemens bribes paid through ex-VP’s wife’s US account– US SEC

The United States’ Security Exchange Commission, which investigated global telecommunications giant, Siemens, for using huge bribes to win multi-billion dollar contracts in over 16 countries, has revealed that the bribes were paid into the US bank acoount of a former Vice President’s wife. It also reveals that a former Nigerian President, the former vice-president and his wife were some of the recipients of these bribes. The SEC also said that Siemens, accused of running an “annual bribery budget of about $40 million to $50 million” in 16 countries, gave at least $12.7 million in bribes to Nigerian officials between 2001 and 2006.

These revelations were contained in a US SEC complaint document made public last week when the settlement that the US Justice Department and the SEC reached with Siemens was announced. To reach the settlement, Siemens had to plead guilty to violating accounting provisions of the US Foreign Corrupt Practices Act, which outlaws bribery abroad, and agree to pay a fine of more than $2.6 billion. The amount includes $1.6bn in fines and fees to Germany and the United States and more than $1bn for internal investigations and reforms.

However, the SEC complaint, which Saturday Punch obtained from www. sec.gov only describes the recipients of the bribes. It does not mention their names. The document, which was submitted to Judge Richard Leon of the United States District Court for the District of Columbia on December 15, has the US SEC as the Plaintiff and Siemens as the Defendant.

Officials of the US Justice Department explained, in a statement, that the names, which were given to the judge in a sealed envelope, could not be made public because of what they described as ‘privacy laws in several countries’ and for the sake of ‘the integrity of continuing investigations’. But Lori Weinstein, the prosecutor, said the documents were deliberately left with clues to provide “sufficient clarity” for the court to figure out who was who. For example, the recipient of the bribes that Siemens officials reportedly gave to highly-placed Argentine officials during an identity-card contract is described as a “president of Argentina who left office in 1999;” an indication that former President Carlos Menem, who ruled Argentina from 1989 to 1999, is the recipient.

In Nigeria, in particular, Siemens, the complaint says, made approximately $12.7m in suspicious payments in connection with four projects, with at least $4.5m paid as bribes in projects involving the Nigeria Telecommunications Limited and the Ministry of Communications. According to the SEC, the total value of the four contracts was about $130m.

The portion of the complaint, which gave the recipients of the bribes, says that approximately $2.8m of the bribe payments was routed through a bank account in Potomac, Maryland, in the name of the wife of a former Nigerian vice-president.

“The Vice President’s wife, a dual U.S. Nigerian citizen living in the United States, served as the representative of a business consultant that entered into fictitious business consultant agreements to perform ‘supply, installation, and commissioning’ services but did no actual work for Siemens. The purpose of these payments was to bribe government officials. Other corrupt payments included the purchase of approximately $172,000 (N17.3m) watches for Nigerian officials designated in internal Siemens records as “P.” and “V.P.,” likely referring to the President and Vice-President of Nigeria.”

It says, “The practice of paying bribes by Siemens COM in Nigeria was long-standing and systematic. According to a high ranking official within Siemens Limited Nigeria, a regional company, corrupt payments in 2000 and 2001 commonly reached 15 to 30% of the contracts’ value. Bribe payments were typically documented using fictitious business consultant agreements under which no actual services were performed. The CEO of Siemens Limited Nigeria forwarded requests for ‘commission’ payments to Siemens headquarters in Germany.

“The illicit payments were then made through a number of means, frequently including large cash withdrawals from cash desks that were then hand-carried in suitcases to Nigeria.”

The complaint accuses Siemens of creating elaborate payment schemes to conceal at least 4,283 payments, totalling approximately $1.4bn.

“Among the transactions on which Siemens paid bribes were those to design and build metro transit lines in Venezuela; metro trains and signalling devices in China; power plants in Israel; high voltage transmission lines in China; mobile telephone networks in Bangladesh; telecommunications projects in Nigeria; national identity cards in Argentina; medical devices in Vietnam, China, and Russia; traffic control systems in Russia; refineries in Mexico; and mobile communications networks in Vietnam,” the document says.

The Siemens bribery scandal caused a stir in Nigeria in October 2007, after a Munich court had found the company guilty of bribing government officials in several countries and fined it 201 million Euros. The court also released some of the names of these officials, including Nigeria’s, while blacking out others.

Subsequently, the Federal Government suspended dealings with the telecommunications firm and the Economic and Financial Crimes Commission commenced investigations, but the progress of this probe has not been made public. nothing has been heard of the investigations, while the Federal Government has since gone back into doing business with Siemens without the firm being fined, as was done in the US and Germany.

source:the news papers