At Siemens, Bribery Was Just a Line Item

Bravo to the investigation team.

I started doing international business in 2003 when I was 20, and this article says it like it is. I'm really happy to see that people are working hard for institutional change, and the media is noticing. Articles like this put cracks in my cynical shell.

Just like prostitution is a line item in business in Bangkok (In 2005 I was the single white male in a group of asian businessmen recruiting Thai workers for a foreign labour contract, and before almost every dinner the host would bring a dozen girls out and ask us to pick one to be our 'companion' for the evening -- totally standard practice which I've since seen all over Asia), and mispricing on invoices is standard practice almost everywhere too (my first-ever international transaction was from Guatemala, and the shipment came with a commercial invoice of 10% of the real purchase price, to evade taxes, and I didn't even ask for this or know they were going to do it), money-under-the-table-to-government has dramatic, massive consequences for people everywhere, especially in the developing world. But it mostly goes unseen and unmentioned, for obvious reasons.

For those so inclined, Raymond Baker wrote a really good tome on this called "Capitalism's Achilles Heel: Dirty Money and How to Renew the Free-Market System".

There are some amazing statements in here:

"Bribery was Siemens’s business model," said Uwe Dolata, the spokesman for the association of federal criminal investigators in Germany

Before 1999, bribes were deductible as business expenses under the German tax code

To handle the business side of bribery, the executives turned to Mr. Siekaczek, a man renowned within the company for his personal honesty

The article failed to mention that Siemens' auditors, KPMG, were also implicated and that they are being dropped by Siemens.

I would like to ask - is Siemens somehow unique in doing this? In the region where I live, from unofficial sources of course, I heard this is a very common practice when a company wants to win a contract...especially government one.

Who cares about the payer of a bribe, what about the recipient? That's far more important.

must be nytimes member to read this article.