Reports: Siemens admits to bribing authorities in metro tenders

By
Wednesday, December 17, 2008

German multinational Siemens has admitted to paying up to US$18mn in bribes to Venezuelan authorities to receive preferential treatment during tender processes for train construction in the cities of Valencia and Maracaibo, international press reported.

The firm's local subsidiary - Siemens Venezuela - was awarded the project to design, build, install and launch Valencia's metro system, in Carabobo state.

The company was also awarded the Maracaibo's metro system, in Zulia state, consisting of a light-rapid rail network, whose construction started in 2006.

Start your 15 day free trial now!

cta-arrow

Already a subscriber? Please, login

The industrial giant admitted to bribery during a trial in a Washington, DC federal court, in what the US justice department has described as its furthest-reaching foreign corrupt practices trial, the reports say.

OTHER BRIBES

After admitting to paying bribes in Germany and the US, Siemens also confessed to bribing authorities in Bangladesh and Argentina, according to the reports.

The firm reportedly acknowledged having paid bribes to authorities for over US$105mn in Argentina, during the governments of Carlos Menem, Eduardo Duhalde and Fernando de la Rúa, between 2001 and 2007.

According to Brazilian paper O Estado do S Paulo, there is evidence linking local branch Siemens Brasil to the payment of at least US$10mn in bribes in the country.

SETTLEMENTS

For corruption in Europe and the US, the company will have to pay over US$1.3bn in settlements, the reports said.

A total US$450mn will be paid to the US justice department to compensate for bribes and attempts to alter corporate finance records, while another US$350mn will be paid to the country's Securities and Exchange Commission.

At the same time, the company agreed to pay over US$530mn in fines in Europe, following a trial in a Munich court.

The Siemens case is not the first in the rail and mass transport industry in South America.

French firm Alstom is currently being investigated for allegedly paying bribes to be awarded the contract for the expansion of an underground train in São Paulo city, and other projects in Venezuela.

The firm has also been accused of bribing Brazilian officials to be awarded the construction of the Itá hydroelectric project, as well as other initiatives in Singapore and Indonesia.

According to reports, Alstom's bribes total around US$200mn.