![]() Nonetheless, when the bribe is combined with the fine it paid for the scandal, it totals €450 million, which is significant according to Newswatch Communications Limited (2007, p.15). However, this fine can be considered a drop in the ocean because it only accounted for just 7% of the €420 that the company paid out in the form of a bribe (Lasher 2011, p.109). In this regard, the first immediate impact is that Siemens was fined €30 million for its engagement in the corruption scandal (Guffey and Loewy 2010, p.84). Therefore, it was against the law for Siemens to engage in a corruption scandal a position, which was justified by the jury who handled the case. This is the general law in most countries, Australia being not an exception, according to Schaffer, Agusti, and Earle (2008, p.44). Mele (2009, p.34) reveals that German law prohibits any official or citizen in the country from engaging in a corruption scandal. The report indicates that Siemens used these funds to bribe government supervisory board officials in a bid to win lucrative contracts in Nigeria and Russia as noted by Hoskisson, Hitt, and Ireland (2008, p.17). Apart from being suspended for 18 months, Hartmann was also fined €40,000 according to Lawler (2012, p.92). Other officials found guilty of the scandal included Hans-Werner Hartmann, the manager in charge of accounting of the telecommunication department of the company (Lawler 2012, p.92). In this regard, “apart from being placed on probation for two years, he was also fined €160,000 for admitting to cover up the bribes and slush fund payments” (Fronz 2011, p.41). Twomey and Jennings (2010, p.16) reveal that the scandal led to the prosecution of Siemens’ chief executive Kutschenreuter after being found guilty of involvement in the corruption scandal. It was at the time that Siemens acknowledged that some of its employees were indeed involved in the alleged fraud. The forensic audit conducted on Siemens financial statements found that about €420M payment could not be accounted for, which investigation later revealed that the money had been paid to foreign purchasing officials in different countries such as the U.S., Italy, Greece, and Puete Rico (Phillips and Gully 2011, p.32). The raid led to the arrest of five Siemens workers, who were then taken to custody for involving in corruption. Immediately after the whistle had been blown on the scandal, a team of investigators was appointed which immediately raided Siemens’ offices in Germany and other countries in the world, such as the U.S., Italy Greece, and Switzerland in a bid to unearth the alleged corruption scandal (Neelankavil and Rai 2009, p.56). In another case, Siemens was alleged to have bribed the officials of the labor representatives of the supervisory board in a bid to win their support over the policies that Siemens intended to implement (Brooks and Dunn 2009, p.15). In the first incidence, Siemens was caught having bribed foreign officials in a bid to win contracts and create a slush fund (Ma 2012). However, the reputation that Siemens has built for several years was brought into question in 2006 after being caught engaged in a series of corruption scandals (Biegelman and Biegelman 2010, p.59). In addition, the company has over 430,000 employees. ![]() It is also one of Europe’s largest technology firms with a revenue base of over $77 billion according to Fernando, Purkayastha, and Bellamkonda (2010, p.2). Siemens AG is a German company with a long history of success and a good reputation in the technology industry (Ma 2012).
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