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CORRUPTION

Siemens pays almost €1 billion to settle corruption case

German industrial giant Siemens agreed to pay nearly €1 billion ($1.4 billion) to US and German authorities on Monday to settle a sprawling corruption scandal.

Published: 15 December 2008 22:02 CET
Siemens pays almost €1 billion to settle corruption case
Photo: DPA

Acknowledging the legal problems could have proved far more costly had it gone to court, company chief Peter Löscher said he was “happy and relieved to have negotiated this fantastic outcome in record time.”

“This is for everyone at Siemens the best Christmas present,” he told Tuesday’s issue of the mass-market daily Bild.

Under the German settlement, prosecutors said Siemens would pay €395 million, on top of a fine of 201 million euros last year over charges it had run an elaborate bribe-and-kickback system to secure foreign contracts.

Under a separate US court settlement Monday, Siemens pleaded guilty to corruption charges and agreed to pay $800 million dollars to avoid prosecution. The group was fined $450 million and agreed to a $350-million settlement with the US Securities and Exchange Commission (SEC), according to court documents.

The scandal could have cost the company even more dearly, however, with speculation running rampant for months that the SEC alone could levy fines of several billion euros.

The 161-year-old conglomerate with activities from nuclear power stations to trains and light bulbs has acknowledged that up to €1.3 billion may have been used illegally to win foreign contracts.

Siemens, which employs some 400,000 people worldwide, found in an exhaustive internal investigation that the practice was widespread across its numerous divisions. US authorities said Siemens had used slush funds, off-book accounting and delivered suitcases full of cash to bribe officials to secure contracts in Argentina, Bangladesh, Iraq and Venezuela.

“Today’s filings make clear that for much of its operations across the globe, bribery was nothing less than standard operating procedure for Siemens,” Acting US Assistant Attorney General Matthew Friedrich said in a statement.

Prosecutors have investigated around 300 people in connection with the affair and US authorities refused to rule out charges against Siemens executives.

“This investigation continues,” Friedrich told a news conference when asked if some company officials could be indicted. He added it was not unusual for a company to be charged for corruption first before invididuals in the firm were charged.

The case far surpassed the amount of money involved in similar corruption cases prosecuted by US authorities, said Linda Chatman Thomsen, director of the enforcement division of the Securities and Exchange Commission.

“This pattern of bribery by Siemens was unprecedented in scale and geographic reach,” she said, saying the company had sought to bribe officials in Asia, Africa, Europe, the Middle East and the Americas.

The German group recently took provisions of €1 billion against potential fines in both Germany and the United States. Since it erupted in late 2006, the scandal led to the resignation of a string of top managers, including chief executive Klaus Kleinfeld and his long-term predecessor and chairman of the board, Heinrich von Pierer.

Siemens has turned against its former management, in particular von Pierer, who ran the company from 1992 to 2005 and then headed its supervisory board for two years. The company has already decided to claim compensation from former executives, who allegedly looked the other way as the company paid bribes to obtain foreign contracts.

Germany’s biggest industrial union IG Metall called on the former managers to “assume responsibility and guilt for the situation in which they put the company with bribes and corruption.”

Under the US settlement deal reached Monday, Siemens agreed to the appointment of a former finance minister, Theo Waigel, as an anti-sleaze ombudsman at the company. He is to report progress in the implementation of a so-called compliance programme to prevent the company from breaking corruption laws and investigating violations if they do occur.

Supervisory board chief Gerhard Cromme said US and German authorities had praised Siemens for an exemplary internal housekeeping in the wake of the affair.

Cromme said US and German authorities had been willing to settle the case because they recognised that “Siemens is a different company today than it was two years ago.”

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TRAVEL

US reclassifies Switzerland: What does it mean for American travellers?

America’s public health agency eased travel alerts for dozens of countries this week, including Switzerland. But does it mean that people from the United States can now travel here?

Published: 11 June 2021 11:37 CEST
US reclassifies Switzerland: What does it mean for American travellers?
Not yet, but hopefully soon. Photo by Jan Rosolino / Unsplash

Switzerland in early June announced vaccinated travellers would be able to come on June 28th. Therefore, this story is now out of date. Please click here for more information. 

Due to massive vaccination efforts around the world, the US Centers for Disease Control and Prevention (CDC) lowered travel warning levels  for more than 110 countries and destinations, including Switzerland.

From the highest level four previously, which means all travel is discouraged, Switzerland was ‘promoted’ to Level 3, allowing travel for fully vaccinated individuals.

In total, 14 countries, including Switzerland’s neighbours France and Italy, have been reclassified to a lower level.

Does this mean American tourists can now come to Switzerland?

Even though the CDC has cleared travel for vaccinated US residents, it doesn’t mean they are now allowed to enter Switzerland.

For the time being, travel ban is still in place for most third countries, including the United States. The only exceptions are Swiss citizens or permanent residents returning to Switzerland.

READ MORE: When will Americans be allowed to travel to Switzerland again —and vice-versa?

There are some other exemptions as well, including people whose presence in Switzerland is absolutely necessary to maintain the functioning of the healthcare system or public security and order, death of a close family member in Switzerland, and to continue essential medical treatment that began in Switzerland or abroad.

Each of these conditions must be proven with official documentation.

For other ‘special necessity’ rules, see SEM’s page.

Basically, this means that tourists or other random travellers can’t come to Switzerland at the moment.

There are, however, some promising signs that this restriction may be lifted.

Swiss president Guy Parmelin is scheduled to meet with his US counterpart, Joe Biden, on June 15th. Biden will be in Geneva for high-level talks with Russia’s president Vladimir Putin. 

It is not known what Switzerland and the United States will discuss at the meeting, beyond matters of importance to both nations, but there is a possibility that the subject of easing travel restrictions on both sides will be raised.

Also, under France’s new traffic light travel system, fully-vaccinated travellers can now enter France from non-EU countries, including the US.

This does not apply to Switzerland yet, but as the two countries share a border and both are part of the Schengen zone, Swiss entry regulations for US tourists might be relaxed in the near future — though not at this time.

Does this mean US residents can ‘slip’ into Switzerland through France?

Borders between the two countries are pretty porous and checks random at best, but if you attempt to get into Switzerland this way, you’d be breaking the law.

The only US citizens who can come into Switzerland legally right now are those residing in the EU/EFTA states, or one of the third nations deemed safe by public health officials:  Australia, New Zealand, Cyprus, Rwanda, South Korea, Singapore, and Thailand.

In other words, it’s not the nationality of a traveller that counts but their place of residence.

What about Swiss citizens going on vacation to the United States?

The US still has a ban in place for tourists from the EU, including Switzerland. It also has similar exceptions — that is, US citizens and permanent residents returning from abroad.

The US is forming expert groups to decide when to lift global travel restrictions that have been in place since March 2020.

However, this will probably take time and, despite mounting pressure from the travel industry and airlines, US-bound travel may not be on the horizon for this summer.

READ MORE: How to get Switzerland’s Covid-19 health pass

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