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Wednesday, 20 March 2013 10:32

Microsoft in bribery scandal

Written by Nick Farrell



Agrees to co-operate

Software giant Microsoft has called in US agencies to investigate allegations of bribery by employees in China, Romania and Italy. Vole said that it is own compliance unit is already investigating the claims, although it is not providing the world with any specifics.

According to the Wall Street Journal the US Department of Justice (DOJ) and US Securities and Exchange Commission (SEC) have released the hounds after a whistleblower came forward. It appears that the former Vole was telling a story about how the Microsoft handed kickbacks to foreign government officials in return for software contracts. Writing in the Volish bog, John Frank, the company's deputy general counsel said that the matters raised in the Wall Street Journal were important. He said that Microsoft took all the allegations seriously and it will cooperate fully in any government inquiries.

However according to Reuters, Vole's own investigators had a crack at the case and after 10 months found no evidence of wrongdoing. None of the watchdogs would confirm the investigation was taking place. It is fairly likely that they will be carried out under the US Foreign Corrupt Practices Act (FCPA).

Bribery cases involving IT outfits and dodgy politicians or government officials are getting pretty common. IBM had to pay out $10 million to resolve SEC charges over improper gifts to government officials in South Korea and China. The DOJ and SEC brought 23 FCPA cases last year, down from 48 in 2011 and 74 in 2010. The Journal said the investigations are in the early stages and the government has not accused any party of wrongdoing.

Frank pointed out that in a company the size of Microsoft allegations of this nature will be made from time to time. It is also possible there will sometimes be individual employees or business partners who violate our policies and break the law. Microsoft had taken steps to train its employees, and to build systems to prevent and detect violations, and when allegations are made they are investigated fully and appropriate action taken.

Nick Farrell

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