The trips highlight inconsistencies in tough ethics rules Congress set for itself. Although registered foreign lobbyists can’t buy a $2 cup of coffee for a congressional staffer in Washington, they are allowed to invite, plan and accompany a staffer on a trip costing $10,000 or more. Nor is there any requirement about how much time is spent on work related to Congress.
Congress overhauled the rules for travel after the 2005 scandal involving lobbyist Jack Abramoff, who had paid for lavish trips for several lawmakers and their families before his 2006 guilty plea on fraud and bribery charges. After Democrats won control of Congress in midterm elections, they passed legislation governing the rules for travel funded by organizations that hire lobbyists, requiring pre-approval of trip itineraries and limiting travel to a single day.
For travel sponsored by companies and other private interests, staffers must submit itineraries to House and Senate ethics committees for approval before departing and also make a full accounting of costs after the trip has concluded. The rules continue to tighten: starting in April, lawmakers and staff will have to submit trips for pre-approval even earlier — 30 days beforehand, up from 14.
By contrast, the costs, itineraries and other details for cultural-exchange trips are not disclosed. When costs are voluntarily added to disclosure forms, they typically run about $10,000 for a week-long trip, including first-class or business-class airfare.
A New York lawmaker who had strong Orthodox Jewish backing because he rejected a gay rights initiative quit after pleading guilty to charges that he funneled bribes through his gay lover.
State Sen. Carl Kruger, a conservative Democrat who has held his Brooklyn seat since 1994, resigned Tuesday just before pleading guilty to laundering up to $1 million from lobbyists through Michael Turano, a real estate agent described by prosecutors as Kruger’s “intimate associate” and housemate.
“I accept responsibility for my actions and am truly sorry for my conduct,” Kruger was quoted by the New York Daily News as telling the court.
SEC Charges Seven Former Siemens Executives with Bribing Leaders in Argentina; Release No. 2011-263; December 13, 2011
SEC Charges Seven Former Siemens Executives with Bribing Leaders in Argentina
FOR IMMEDIATE RELEASE
Washington, D.C., Dec. 13, 2011 — The Securities and Exchange Commission today charged seven former Siemens executives with violating the Foreign Corrupt Practices Act (FCPA) for their involvement in the company’s decade-long bribery scheme to retain a $1 billion government contract to produce national identity cards for Argentine citizens.
Siemens was previously charged with FCPA violations and paid $1.6 billion to resolve the charges with the SEC, U.S. Department of Justice, and Office of the Prosecutor General in Munich.
The SEC alleges that the executives who perpetuated the scheme worked at Siemens and its regional company Siemens Argentina. One of the executives had left Siemens and acted as a payment intermediary in the scheme. Siemens paid more than $100 million in bribes to such high-ranking officials as two former Argentine presidents and former cabinet members. The executives falsified documents including invoices and sham consulting contracts, and participated in meetings in the United States to negotiate the terms of bribe payments. They used U.S. bank accounts to pay some of the bribes.
“Business should flow to the company with the best product and the best price, not the best bribe,” said Robert Khuzami, Director of the SEC’s Division of Enforcement. “Corruption erodes public trust and the transparency of our commercial markets, and undermines corporate governance.”
In a parallel criminal action, the Department of Justice announced charges against former executives and agents of Siemens. They are charged with conspiracy to violate the FCPA and the wire fraud statute, money laundering conspiracy and wire fraud.
According to the SEC’s complaint filed in U.S. District Court in Manhattan, the scheme lasted from approximately 1996 to early 2007. Initially, the bribes were paid to secure a $1 billion contract to produce national identity cards known as Documentos Nacionales de Identidad (DNI) for every Argentine citizen. After a change in Argentine political administrations resulted in the DNI contract being suspended and then canceled, Siemens paid additional bribes in a failed effort to revive the DNI contract. When the company later instituted an arbitration proceeding to recover its costs and expected profits from the canceled contract, Siemens paid additional bribes to suppress evidence that the contract originally had been obtained through corruption.
The former Siemens and Siemens Argentina executives charged by the SEC each had a role in authorizing, negotiating, facilitating, or concealing bribe payments in connection with the DNI contract:
Uriel Sharef - A former managing board member at Siemens from July 2000 to December 2007. He met in the United States with payment intermediaries and agreed to pay $27 million in bribes to Argentine officials in connection with the DNI contract.
Ulrich Bock - Former Commercial Head of Major Projects for Siemens Business Services (SBS) from October 1995 to 2001. As the officer responsible for the DNI contract, he authorized bribe payments to Argentine government officials.
Stephan Signer -Replaced Bock as Commercial Head of Major Projects for SBS and later became Head of Business Operations and Finance at Siemens IT Solutions and Services. He authorized the payment of bribes to government officials in Argentina.
Herbert Steffen -CEO of Siemens Argentina from 1983 to 1989 and again in 1991, and Group President of Siemens Transportation Systems from 1996 to 2003. Due to his longstanding connections in Argentina and Latin America, Steffen was recruited by Sharef and met directly with Argentine officials and offered bribe payments on behalf of Siemens.
Andres Truppel -CFO of Siemens Argentina from 1996 to 2002. He regularly communicated with Argentine government officials regarding illicit bribe payments and participated in U.S.-based meetings where bribes were negotiated and promised.
Carlos Sergi -A former board member of Siemens Argentina and a business consultant for Siemens Argentina. His primary role was to serve as a payment intermediary between Siemens and Argentine government officials in connection with the DNI contract.
Bernd Regendantz -CFO of SBS from February 2002 to 2004. He authorized two bribe payments totaling approximately $10 million on Siemens’ behalf.
According to the SEC’s complaint, approximately $31.3 million of the $100 million in bribes paid were made after March 12, 2001, when Siemens became a U.S. issuer subject to U.S. securities laws. As a result of the bribe payments it made, Siemens received an arbitration award in 2007 against the government of Argentina of more than $217 million plus interest for the DNI contract. In August 2009, after settling bribery charges with the U.S. and Germany, Siemens waived the arbitration award.