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CRIME

Siemens director admits to setting up slush fund

The first hearing on corruption at Siemens began Monday with a defendant acknowledging the existence of a slush funds at the giant German industrial group.

Siemens director admits to setting up slush fund
Media angle for a shot of Siekaczek (r) on May 26. Photo:DPA

Reinhard Siekaczek, 58, a former head of Siemens’ fixed telephone unit ICN, said he had set up, with the approval of his superior, a fund used to pay kickbacks.

Some €53 million ($84 million) was paid into this fund over three years, he said.

In all, Siemens has acknowledged that €1.3 billion disappeared into various funds following an internal probe that began in late 2006.

Investigators have since determined that payments to obtain foreign contracts was a widespread practice among Siemens’ various divisions.

To date however, only one judicial ruling has been issued in connection with the affair.

In late 2007, a fine of €201 million was levied against the group’s communications systems division, which was the first identified as having made illicit payments.

The trial of Siekaczek marks the start of proceedings against individual managers suspected of having taken part in the kickback system.

Several senior Siemens directors have also been identified as suspects, but former boss Heinrich von Pierer, a high profile German industrial figure, is not expected to face serious charges and could at most be fined €1 million for dereliction of duty.

Von Pierer was forced to step down as head of the supervisory board of Siemens, a company he had run for 13 years, while current Siemens boss Peter Loescher was hired from outside the group to clear up the affair.

BUSINESS

Elon Musk visits Tesla’s sabotage-hit German factory

Elon Musk travelled Wednesday to Tesla's factory near Berlin to lend his workers "support" after the plant was forced to halt production by a suspected arson attack on nearby power lines.

Elon Musk visits Tesla's sabotage-hit German factory

The Tesla CEO addressed thousands of employees on arrival at the site, accusing “eco-terrorists” of the sabotage as he defended his company’s green credentials.

With his son X AE A-XII in his arms, Musk said: “I am here to support you.”

The billionaire’s visit came a week after power lines supplying the electric carmaker’s only European plant were set on fire in an act of sabotage claimed by a far-left group called the Vulkangruppe (Volcano Group).

READ ALSO: Far-left group claims ‘sabotage’ on Tesla’s German factory

Musk had said then that the attack was “extremely dumb”, while the company said it would cost it several hundred million euros.

A week on, the lights have come back on at the site, but Andre Thierig, who heads the site, said on LinkedIn that it would “take a bit of time” before production is back to full speed.

Industry experts have warned that the reputational impact caused by the sabotage on the region could be more severe than the losses suffered by Tesla.

Tesla’s German plant started production in 2022 following an arduous two-year approval and construction process dogged by administrative and legal obstacles.

Tesla wants to expand the site by 170 hectares and boost production up to one million vehicles annually to feed Europe’s growing demand for electric cars and take on rivals who are shifting away from combustion engine vehicles.

But the plans have annoyed local residents, who voted against the project in a non-binding ballot last month.

After the vote, Tesla said it might have to rethink the plans. Environmental activists opposed to the expansion of the factory have recently also set up a camp in a wooded area near the plant.

READ ALSO: Why is Tesla’s expansion near Berlin so controversial?

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