December 21, 2008

Ex-Siemans official defends bribes

A former accountant for the German engineering giant Siemens from 2002 to 2006 says he oversaw an annual bribery budget of about $40 million to $50 million.

Accountant Reinhard Siekaczek said the money was used to curry favor with leaders around the world. Last week, the scheme cost the company $1.6 billion in the largest fine for bribery in modern corporate history, The New York Times reported Sunday.

Siekaczek said the payments helped maintain the competitiveness of Siemens AG overseas, particularly in his subsidiary, which sold telecommunications equipment.

It was about keeping the business unit alive and not jeopardizing thousands of jobs overnight, Siekaczek was quoted by the newspaper as saying.

American companies are barred under the Foreign Corrupt Practices Act from paying bribes to secure foreign business.

German prosecutors initially opened the Siemens case in 2005. U.S. authorities became involved the following year because the company's shares are traded on the New York Stock Exchange.