The World Bank Group announced a comprehensive settlement with Siemens AG in the wake of the company's acknowledged past misconduct in its global business and a World Bank investigation into corruption in a project in Russia involving a Siemens subsidiary. The settlement includes a commitment by Siemens to pay $100 million over the next 15 years to support anti-corruption work, which would include providing funds to organizations and projects aimed at combating corruption through collective action, training, education.
The money will also be directed to helping governments to recover assets stolen by corrupt leaders, and strengthening efforts to identify and crack-down on corrupt practices. The World Bank Group will have audit rights over the use of these funds and veto rights over the selection of anticorruption groups or programs receiving funds.
As part of the settlement deal, Siemens Russia, an affiliate of Siemens AG, will face up to a four year debarment in connection with violations, prior to 2007, following an investigation by the World Bank into corrupt practices under the Bank-financed transportation project in Russia, the Moscow Urban Transport Project.
The settlement also includes a voluntary two-year shut-out from bidding on Bank business for Siemens AG and all of its consolidated subsidiaries and affiliates.
While commenting on this settlement deal, Leonard McCarthy, Integrity Vice President at the World Bank, said, "This settlement provides significant consequences for past wrongdoing by Siemens. At the same time, Siemens ongoing extensive cooperation could help the World Bank hold more corrupt firms and individuals accountable for diverting precious development resources away from the people who need them."
Andreas Pohlmann, Siemens Chief Compliance Officer, said, "We look forward to continuing to work with the Bank to eliminate fraud and corruption in our markets and we see this as confirmation of our work to establish a robust compliance program and to pursue collective action together with the Bank in those markets."
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