Indictment of six former Siemens executives originated with an internal FCPA investigation by Siemens that also resulted in Siemens paying fines of $448 million
Uriel Sharef has become the first former board member of a Fortune Global 50 company to be charged under the US Foreign Corrupt Practices Act. Mr Sharef and five other former Siemens executives, and two of their agents, have been charged by the US Department of Justice for “allegedly engaging in a decade-long scheme to bribe senior Argentine government officials to secure, implement and enforce a $1 billion contract with the Argentine government”. The details of the indictment and of the $100 million that was allegedly committed to be paid in bribes (including by physically carrying $10 million into a Swiss bank) are set out in this DoJ press release.
The most interesting aspect of this case from a compliance and governance perspective is that the indictments are the ultimate result of an investigation by Siemens itself which has resulted in a “complete restructuring” of Siemens, as described in the DoJ press release:
“[The] charges follow, in large part, the laudable actions of Siemens AG and its audit committee in disclosing potential FCPA violations to the department after the Munich Public Prosecutor’s Office initiated an investigation. Siemens AG and its subsidiaries disclosed these violations after initiating an internal FCPA investigation of unprecedented scope; shared the results of that investigation; cooperated extensively and authentically with the department in its ongoing investigation; and took remedial action, including the complete restructuring of Siemens AG and the implementation of a sophisticated compliance program and organization.”
The charges against these individuals follows the guilty pleas by Siemens and its Argentine subsidiary in 2008 to criminal violations of the FCPA, which saw fines of over $448 million paid.
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