Siemens pays fine to settle corruption case

Dec 14, 2008

The parent company of Siemens Healthcare said that it will pay fines and penalties of approximately one billion euros ($1.34 billion U.S.) to settle legal proceedings against the firm in Germany and the U.S.

Siemens AG paid 395 million euros ($528.8 million U.S.) to settle a legal proceeding in Germany that alleged the failure of the former managing board of Siemens to fulfill its supervisory duties. The payment follows a 201 million euro ($269.1 million U.S.) fine in October 2007 relating to Siemens' former telecommunications group.

In the U.S., Siemens pleaded guilty in a federal court in Washington, DC, to charges of knowingly circumventing and failing to maintain adequate controls and failing to comply with the books and records provisions from the U.S. Foreign Corrupt Practices Act (FCPA). Three Siemens subsidiaries also pleaded guilty to individual counts of conspiracy to violate the FCPA, Siemens said.

In connection with the pleas, Siemens and the three subsidiaries agreed to pay a fine of $450 million (336 million euros) to resolve charges leveled by the U.S. Department of Justice. Siemens said it also settled a civil action from the U.S. Securities and Exchange Commission for violations of the FCPA and agreed to disgorge profits in the amount of $350 million (261 million euros).

Under the terms of the plea and settlement agreements in the U.S., Siemens has engaged former German finance minister Dr. Theo Waigel as a compliance monitor for the firm.

In other developments, the U.S. Defense Logistics Agency has issued a formal determination that Siemens remains a responsible contractor for U.S. government business, Siemens said.

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