Siemens offers settlements in corruption cases

Germany's Siemens offers former managers corruption settlement option; sets November deadline

• By George Frey, AP Business Writer
• On 7:13 am EDT, Wednesday September 23, 2009

FRANKFURT (AP) -- Siemens AG said Wednesday that it has offered to negotiate settlements with seven former senior managers from whom it is seeking damages in connection with a massive bribery scandal -- and set a mid-November deadline for them to respond.

The Munich-based industrial conglomerate said the managers include former chief executives Heinrich von Pierer and Klaus Kleinfeld, who is now CEO of Alcoa Inc.

The offer also applies to former board members Johannes Feldmayer, Thomas Ganswindt, Heinz-Joachim Neubuerger, Juergen Radomski and Uriel Sharef.

Siemens said it was giving those men "the opportunity to declare their willingness to reach a settlement" by mid-November.

"The company will take legal action against those individuals with whom it has not reached an agreement by this date," Siemens said in a statement.

The company, which makes products ranging from wind turbines to trams, has acknowledged making dubious payments in the past to secure business. An investigation commissioned by Siemens found evidence of violations across the company, and in several countries, and Siemens agreed last year to pay more than $1 billion in fines to authorities in Germany and the U.S.

Siemens also said Wednesday it had reached an agreement with its management liability insurance in which it could receive up to euro100 million ($148 million) in a settlement related to the incident.

Also Wednesday, Siemens said its supervisory board had approved settlements with three more former managers: Klaus Wucherer, Rudi Lamprecht and Edward Krubasik.

Under those settlements, which were negotiated in August, the former managers agreed to pay the company euro500,000 each to avoid years of litigation and costs.

The company said it would make final decisions regarding all agreements by January 26, 2010, the date of its annual general meeting.

Von Pierer -- the Siemens CEO until 2005 and then the supervisory board chairman -- has denied any wrongdoing.

Kleinfeld, von Pierer's successor as CEO, also denies any wrongdoing. When the corruption allegations emerged in 2006, he hired an outside anti-corruption expert and a law firm to examine and revise the company's anti-corruption safeguards.

Kleinfeld is now the CEO of Alcoa Inc., one of the world's largest aluminum producers, based in Pittsburgh.

Shares of Siemens were about a third of a percent lower at euro65.48 in Frankfurt afternoon trading.

http://www.siemens.com

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