28 March 2010

Daimler Accused Of Paying Bribes

According to the article: www.just-auto.com/article.aspx?id=103807&lk=dm, Daimler has escaped criminal charges in a US investigation into the firm's bribery practices.
The company has admitted to making hundreds of improper payments worth tens of millions of dollars to foreign government officials in at least 22 countries between 1998 and 2008. The bribes included cash and gifts to help secure government contracts worth millions of dollars in countries including China, Russia and Iraq.
Department of Justice prosecutors are recommending a USD93.6m dollar fine (on top of a similar sized fine imposed by the SEC) for the company - which has pleaded guilty, fully cooperated with the investigation and apparently mended its ways.

It's been going on a lot longer too. I recall many years the ARA (Auckland Regional Authority) sending a man over to Europe to buy a fleet of buses for Auckland City, NZ. He bought very expensive Mercedes Benz ones and on his return promptly resigned under a cloud of accusations about his decision. I do not know how widespread this practice is but Daimler has either been unlucky or an industry leader in winning contracts unfairly with this sort of behaviour.
Simply put, corruption is a blight on human society. Someone has to pay for it and in the Auckland case, it was the city ratepayers. Let us hope Daimler have truly mended their ways.

The bottom line: Companies must win contracts with the best products and prices, but not the corrupt way.

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