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HP's Moscow Offices Raided In Bribery Probe
FrankPoole writes "Hewlett-Packard's Moscow offices were raided Wednesday as part of a bribery investigation by Russian and German authorities. The news was first reported by The Wall Street Journal [currently paywalled; Reuters also covered it], which wrote that HP is suspected of allegedly paying out nearly $11 million in bribes to secure a major Russian government contract several years ago via a German subsidiary. Ironically, the contract was with the Prosecutor General's office of the Russian Federation, which will now play a role in investigating HP. While HP knew of the investigation as far back as December, the company did not disclose the information in any SEC filings. Instead, in its most recent quarterly report, HP states that in foreign nations 'it is common to engage in business practices that are prohibited by laws and regulations.'"
In many other nations, the distinction between the laws on paper and accepted practices is much greater than it is in the United States (except maybe in Chicago or Philadelphia...). For instance, in most of the US, if you try to bribe a cop to get out of a traffic ticket, you're going to jail most of the time. In Mexico, the bribe -- la mordida -- is pretty much expected, and you're more likely to go to jail if you DON'T offer it, even though bribery is illegal in Mexico. So HP actually has a point here.
Looks like HP made the mistake of dealing with a dishonest politician... defined as one who won't stay bought.
It was Fiorina at the time.
In many other nations, the distinction between the laws on paper and accepted practices is much greater than it is in the United States
Too bad for US corps, we have this law here called The Foreign Corrupt Practices Act that makes it illegal to bribe foreign officials.
When information is power, privacy is freedom.
While i didnt RTFA, but just to focus in on one aspect of the summary,
"HP states that in foreign nations 'it is common to engage in business practices that are prohibited by laws and regulations.'"
While they may have been wrong in this situation, the statement itself is very true; After spending some time in china for instance, bribery is certainly prevalent. Also when we examine the US system, with lobbyists and contributions... is it really that different?
Wow. ok.
History lesson:
The US and its primary allies are the first world nations.
Russia and its primary allies are the second world nations.
Everyone else that isn't important enough to vaporize in a global thermo-nuclear war is a third world nation.
Instead, in its most recent quarterly report, HP states that in foreign nations 'it is common to engage in business practices that are prohibited by laws and regulations.'
Apparently they didn't read their own Ethics & Compliance materials. As a former HP employee, I can tell you that every year the employees are required to take an online course in Ethics and Compliance. Part of those materials mentions that HP won't participate in any activities that are expected practice in other countries, but forbidden in the US. The specific example of bribery was included. Furthermore, simply knowing that a partner or subsidiary is doing something unethical on behalf of HP is forbidden. The act of a business partner bribing a customer to secure a contract for HP was one of the examples. In fact, there were even videos with actors portraying these situations. Then again, maybe the training materials grew out of this specific case.