Motorola Under SEC Investigation for Bribes
9/5/2011 by: John Oram
Saturday, the Austrian weekly Profil revealed US SEC (Securities and Exchange Commission) regulators are investigating an Austrian lobbyist and US telecom maker Motorola over alleged bribes.
Under investigation: Alfons Mensdorff-Pouilly, Austrian lobbyist is currently under investigation for 2.2M Euro in bribes. Photo credit: Profil.at
The story claims that from April 2004 onwards, Motorola transferred up to 2.2 million euros ($3.12 million) to three firms controlled by Austrian lobbyist Alfons Mensdorff-Pouilly. The lobbyist reportedly made illegal payments to high ranking politicians in Europe and the Middle East.
The news magazine reported last week on an alleged contract between the lobbyist and Motorola over a digital radio project by the Austrian government. Mensdorff-Pouilly allegedly helped secure the project for a consortium including Motorola and Telekom Austria, gaining up to 2.6 million euros in the process.
Telekom Austria is itself facing a wave of corruption claims that emerged in recent weeks, and on Friday announced an external probe by international experts into the allegations.
Rumors are Motorola is being investigated by the US Department of Justice (DOJ) for violating federal anti-bribery laws, specifically 1977's Foreign Corrupt Practices Act (FCPA). The FCPA prohibits US companies or their agents and employees from offering or paying bribes to foreign government officials or employees of state-owned companies to do business, other companies have also fallen into the practice in parts of the world where bribery is a common business tactic and companies failing to offer bribes do not win contracts.
Motorola's hands caught in the Eurocookie Jar, According to current investigation independently held by DOJ and SEC
According to the same sources, the SEC is also investigating Motorola for "possible civil violations." The US DOJ has reportedly gotten tougher with policing bribery allegations and enforcing laws, and has upped the fines in the last few years. In 2010, the agency brought 24 enforcement actions, nearly five times the number of actions in 2004.
Mensdorff-Pouilly appears to be no stranger to corruption claims. In January 2010, he was charged in Britain with bribing European officials to secure fighter jet contracts for defense giant BAE Systems. The charges were eventually dropped.
BSN* will watch this one because it may have some interesting sidelines. How will this affect the Google - Motorola buy out? Will this have any effect on the AT&T and T-Mobile proposed $39 billion merger? The one that the US DOJ (Department of Justice) just sued AT&T to stop it. Time will tell.
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