Microsoft may be in a bit of a bribery bungle
19th Mar 2013 | 20:08
Entangled in some international intrigue?
Mere weeks after the European Commission slapped Microsoft with a $731 million (around £485m, AUS$712m) fine, the tech company may again find itself in hot governmental water.
Sources speaking with the Wall Street Journal say that U.S. regulators are looking into dealings between Microsoft and business partners that allegedly bribed foreign government officials in exchange for software contracts.
An anonymous tipster informed regulators that a Microsoft exec at the company's China subsidiary told the tipster to offer kickbacks to Chinese officials in exchange for contracts, the Journal said.
The tipster, a former Microsoft rep reportedly involved in a labor dispute with the company, brought his or her allegations to investigators in 2012.
The accusations were also part of a 10-month 2010 internal investigation by Microsoft, which found no evidence of wrongdoing.
Other dubious dealings
Alleged illegal dealings between Microsoft, Romania's Ministry of Communications and consultants in Italy are also under U.S. investigation.
Bribes offered by resellers in return for software contracts are at the heart of the Romanian inquiry, while the company's Italian unit allegedly used consultants as a proxy to bestow "lavish gift and trips" on procurement officials in exchange for government business.
The probe, led by lawyers at the Justice Department and Securities and Exchange Commission, is still in the early stages. In fact, no charges have been levied against Microsoft or its business affiliates, the publication's sources said.
After a request for comment, Microsoft sent TechRadar a statement from John Frank, vice president at Microsoft and deputy general counsel.
"We take all allegations brought to our attention seriously and we cooperate fully in any government inquiries," Frank's statement read.
"Like other large companies with operations around the world we sometimes receive allegations about potential misconduct by employees or business partners and we investigate them fully regardless of the source.
"We also invest heavily in proactive training, monitoring and audits to ensure our business operations around the world meet the highest legal and ethical standards."
Frank also wrote a blog post titled, "Our Commitment to Compliance" today in response to the Journal's report. His statement is also included in the post.
Though he avoided commenting directly on the investigation or acknowledge its happening, he did write that Microsoft takes such allegations seriously and "we cooperate fully in any government inquiries."
The VP noted it's not unusual for reviews to turn up no wrongdoing, and pointed out that the WSJ conducted an internal investigation into allegations brought against the publication.
Frank outlined that as a global company, Microsoft works in 112 countries with 98,000 employees and 640,000 business partners.
"In a company of our size, allegations of this nature will be made from time to time," he wrote.
"It is also possible there will sometimes be individual employees or business partners who violate our policies and break the law."
About 170 employees are tasked with compliance and investigating potential breaches of company policy. And while claims of bribery are nothing new, we'll have to see if the U.S. government turns up anything that gives these allegations some bite.