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US, Germany, Russia investigating HP bribery claims

updated 05:55 pm EDT, Thu April 15, 2010

HP may have bribed to get contract

An investigation is underway into allegations that HP may have bribed the Russian government to win a computer contract. German, Russian and now reportedly US officials are checking a claim that the PC builder sent the equivalent of $10.9 million to Russia's prosecutor general's office, through a German partner firm, to guarantee that it would get a lucrative deal supplying PCs. The bribe was allegedly elaborate masked and routed through shells in the US and locations as far away as Belize and the British Virgin Islands.

Sources for the WSJ claimed the US was getting involved as the accusations, if true, could violate the Foreign Corrupt Practices Act. The Justice Department would address any direct criminal lawbreaking while the Securities and Exchange Commission would handle the civil side of the case.

HP has acknowledged the basic investigation and said it's "fully cooperating" with both American and German officials, though it's understood that Russia's own investigators raided HP's local offices on Wednesday to look for evidence. Three had been arrested as far back as December but weren't charged with any crimes.

Any charges filed could be grave for both HP and for the PC industry. HP is the single largest PC maker in the world with one quarter of the market but is in fierce battles to fend off rapidly growing Acer as well as to keep Dell on the decline. The bribery if real would hint at bribery as a possible tactic to prevent competitors from landing deals, although it remains far from clear as to whether any illegal activities were conducted by a rogue or part of a larger campaign.



By Electronista Staff
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  1. cvbcvb

    Fresh-Faced Recruit

    Joined: Nov 2003

    0

    Normal

    If that is normal business practice in Russia (bribing officials) what is a company to do in order to get business...

  1. rtbarry

    Fresh-Faced Recruit

    Joined: Aug 2001

    -1

    "elaborate masked"?

    "elaborate masked"? really?

  1. testudo

    Forum Regular

    Joined: Aug 2001

    0

    I can hear them now

    The officials in Russia and Germany are saying to these guys "Man, why did you have to get caught. Now we actually have to pretend to care about these things!"

  1. testudo

    Forum Regular

    Joined: Aug 2001

    +1

    grave?

    I'd like to hear how these allegations 'if true' can be 'grave' to the PC industry as a whole. If anything, you'd think Dell would be dancing in the street hoping it is.

    And HP should have just done an end-around on this whole thing by moving their corporate offices to Bermuda or some other carribbean nation, get all the American tax breaks without having to pay American taxes, and also not be liable for breaking some American law.

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