Legal News

Siemens Bribery Scandal Getting Rooted Out From the Inside

By Dan Slater

It’s been over a year since Siemens, Europe’s largest engineering company, hired lawyers from Debevoise & Plimpton to help it root out its own wrong-doers in what’s believed to be the biggest corporate bribery scandal ever.

But now, thanks to an amnesty plan for Siemens employees willing to offer information about the scandal, the investigation is bearing fruit. According to this morning’s WSJ report, 110 Siemens employees have come forward to offer information, and the company has identified nearly $2.5 billion in suspicious transactions between 2000 and 2006. (A German court already fined Siemens $306 million in October for bribing government officials in Nigeria, Russia and Libya to win business contracts.)

Siemens’ GC, Peter Solmssen, who recently joined the company from General Electric, said the amnesty program “has helped us figure out lines of responsibility. Who said what to whom and when.” Solmssen says corruption at Siemens was systemic. “There was a cultural acceptance that this was the way to do business around the world, and we have to change that.”

Many German employees initially were reluctant to act as informants because that evoked memories of the methods used by the Nazi and East German secret police, according to Solmssen. Gradually, though, Siemens workers recognized that “allowing crimes to persist is a form of aiding and abetting.”

It’s perhaps no wonder Debevoise has helped Siemens make headway. The firm’s white-collar crime practice is stacked with 11 former federal prosecutors, including Mary Jo White, the former U.S. attorney for the SDNY, and Bruce Yannett, a former AUSA for the District of Columbia who now heads the dozens of Debevoise lawyers investigating Siemens.

Full post as published by Law Blog - WSJ.com on March 05, 2008 (boomark / email).