SAP Paid Bribes To Panamanian Officials 72
jfruh writes: A former SAP exec has pled guilty to bribing Panamanian officials in a successful attempt to sell SAP licenses to the Panamanian government. Vicente Eduardo Garcia, SAP's former vice president of global and strategic accounts for Latin America, says he wasn't the only SAP employee who knew about the scheme. From the Dept. of Justice press release, "According to Garcia’s admissions, the conspirators used sham contracts and false invoices to disguise the true nature of the bribes. Garcia further admitted that he believed paying such bribes was necessary to secure both the initial contract and additional Panamanian government contracts."
I thought this was the only way SAP gets sold. (Score:5, Insightful)
I thought this was the only way SAP gets sold. It's not like any rational person would pull it into their organization. But for a $90K payday, sure, it's only the taxpayers' money, right?
Re:I thought this was the only way SAP gets sold. (Score:4, Informative)
I thought this was how the wheels of bureaucracy were greased in Central America.
Friends of mine headed south from Belize to continue a trip we were on together, and they experienced it along the rest of their trip through Central America. Get to a border: Grease a palm. Get stopped randomly by the "police:" Grease a palm. Since money is paper, I guess you can call that "paperwork." Only, it is far more efficient than the other kind.
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Gift are also nice. I usually stock up on alcohol and a variety of electronics. However, 'documentation' is important.
Yo necito mi documentation, gracias...
No, no... mi Espanol es muy mierda. Habla Englais? Gracias!
Smile, nod, do not waste time, and get moving as soon as you can.
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You're on crack. I and my parents have all driven road trips through Mexico, and though road side inspections can sometimes be intimidating (young punk kids with AK's on their backs), they generally poke around your luggage for contraband and send us on our merry way (if they hadn't just wave us though, which is what normally happens).
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Tourist vs. foreign business man. If you are an 'outsider' trying to enter into business in Latin or Slavic cultures (this also holds true for Spain and Portugal as well as Latin/South America) you will get much more done by doing "paperwork" vs doing the actual paperwork.
It's an established cultural phenomenon that seems to work as a form of protectionism. You'll get a lot more done in those cultures by hiring a/the local(s) and putting them to work for you. Especially in Slavic cultures, you'll give someo
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Panama City Skyline (Score:4, Informative)
I spent four years in Central America, in Costa Rica and Panama. I only wonder why this is news.
If you take a look at the Panama City skyline [wp.com], it's pretty impressive. The population for the metropolitan area is only about 1.5 million though, so why all the skyscrapers? Who lives there?
No one. The government started investing in infrastructure after the Canal changed hands [wikipedia.org] and they actually started getting money from it, and this fostered a booming construction trade. The construction companies thought that this government money was a grand idea, and the best way to keep it flowing is obviously to kick some of it back to the government officials. [latimes.com] The government has spend the last decade trying to hide the debt that has been piling up as a result of this, and the only thing that I can say is that at least some of the money went into infrastructure.
Corruption is the expected norm in the entirety of Central America. It's how things are done there. I've bribed police there myself, and one of my friends was elected Representante de Panama while I was there: I can confirm that this operates the same way on all levels. The only reason I can think of why this would show up in the news at all is that someone didn't get paid enough. Where is the story here?
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I thought this was the only way SAP gets sold. It's not like any rational person would pull it into their organization. But for a $90K payday, sure, it's only the taxpayers' money, right?
Only in Banana Republics. Here in the Good Old USA, Dogbert Consulting (rates $1500/hr and up) tells Senior Management that unless they install SAP that their Fortune Corporation will collapse. Just incidentally, Dogbert Contracting Services has a stable of contractors (billed $350/hr and up) who will assist in installing it.
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Actually, didn't Donald Trump announce at the last debate that he often bribes politicians in the US, and even mentioned some of his company on stage at the time? None of them disagreed, and one even said he would take more money from Trump. Don't see how this is any different. It is still bribing government officials (and candidates for office). But sometimes the "favor" doesn't get asked for right away. Maybe a year or two later. At least according to Trump the briber.
Trump should've brought cancelled checks with him (Score:2)
This was a huge strategic misstep by Trump.
Not that he mentioned it -- you could see many candidates look visibly nervous when he mentioned he had given donations to most of the candidates on the stage.
What he SHOULD have done was produced cancelled checks (or certified facsimiles) from his suit coat, held them out in his hand, and said "I've donated money to most of these guys at one point, and here are the cancelled checks to prove it" and then run through them rattling off amounts, dates and names.
That w
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Well, you've distilled one key problem with modern capitalism quite well. You can't "do business" without "greasing the skids". Somehow sounds a bit distinct from any kind of "government of, by and for the people". Unless you meant the rich people.
Now they don't need to route the money through anything other than their own superpacs. It is quite legal thanks to 5 out of 9 SC justices.
I hope this continues to be a point of discussion in this election, rather than what names Trump called certain women.
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I hope this continues to be a point of discussion in this election, rather than what names Trump called certain women.
This is where Trump's personality is doing him in.
If he was just a little less of an asshole, his intimate knowledge of money in politics from a *buyer's* perspective and ability to name names, amounts and "policy outcomes" might be a huge advantage.
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It's funny, because Trump figured out that what pleases primary voters is not the same thing that pleases party operatives and media personalities (notice I did not say journalists, which we don't have much of anymore). He knows that being a gigantic, egotistical snarky ahole is exactly what so many people want to hear. A lot of Americans would rather hear someone hurl insults as opposed to talking about policy issues. So he may have had to sign a truce with Fox News, but he is going to keep doing the same
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You know, if being a greedy, corrupt, rich douchebag who bought politicians in the past is ever considered a plus in running for office ... your society is deeply fucked.
He can't be part of the solution when he's part of the problem. Precisely because he doesn't see it as a problem, and probably defends the practice.
Do you want to live in a world in which a billionaire president buys whatever policy outcomes he wants by paying off the rest of the politicians? Or blackmailed them by saying he'll tell how
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My (probably too charitable) assumption is that Trump is just a highly pragmatic businessman who sees stuff like paying off politicians as an undesirable but unavoidable part of the existing system. He made a statement like that at the debate regarding bankruptcies where he said he was just using the system as it existed.
It's just the rules of the game as it exists. You can play by them and achieve your goals, or you can take a moral stance and achieve your goals, but suboptimally (higher costs, longer de
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That's pretty much how anything gets sold to the government of India. There is a well know "procedure" of doing it too. Western companies hire and pay huge sums of money to local consulting companies to do "Consulting" with the local governments. What the consulting companies really do is, they transfer that money to the officials in the local government and will in turn generate an invoice for the western company. So the transaction from the perspective of the western company selling any goods is "white".
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Yeah, yeah, we get it. You want some of that corporate america money for yourself but that annoying FCPA law stops them from giving you the bribes you deserve.
You're really dipping into classic villain territory here. Insulting someone for taking the moral high ground even if it means a minor inconvenience (slightly reduced profits).
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What? It stops nothing. They spin an independent entirely foreign marketing division and know nothing of bribes from then on. Just high marketing costs.
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I am no expert in Panamanian culture but it seems to be accepted, even by the general populace. I have spent a bit of time in the area and greasing palms is how you get things done. Hell, it is how you function. Add an extra $100 to your gas money expenses just to travel. Carry gifts and currency. Carry AMERICAN currency. I have driven around in a giant RV (which they can really make a mess of but don't - they are out of sight and can more easily accept a gift or a cash payment) with way too many drugs in m
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Absolutely. I work for a multinational that has to get equipment into...less than reputable...parts of the world. If you try to ship something yourself to some countries, you can guarantee that most of it will be "lost in transit" or stuck in customs for months and months while a whole network of people get paid to get it through.
Companies that do lots of international shipping have to rely on "freight forwarders" These are the companies that actually pay the bribes, know the right contacts to get stuff thr
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American naÃveté is not realizing
Oh, we understand how the system works. It's called the " Foreign Corrupt Practices Act" (emphasis on foreign). Because it's perfectly OK* to slip US purchasing agents or executives cash, stock options, or Hookers&Blow to make sales.
*Government contracts excepted.
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Corruption in South America? Say it ain't so!
I could hardly believe it myself!
Re:I'm shocked! (Score:5, Informative)
>> in South America? Say it ain't so!
I'll say it ain't so. Panama's in CENTRAL America.
http://lmgtfy.com/?q=google+ma... [lmgtfy.com]
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Everything that's south of the Nothern America is Southern America... at least for some :)
No kidding (Score:4, Insightful)
Paying bribes is one of the only ways SAP is likely to get their foot in the door. After that the money all flows the other way.
SAP market penetration (Score:5, Funny)
I thought SAP already had pretty a pretty solid foothold in the Spanish-speaking world.
You always see "Transmitido en Español en SAP" at the beginning of soap operas and game shows and things.
How is this different from any other SAP sale?? (Score:4, Interesting)
I know I sound cynical, but enterprise software vendors can't make these multimillion dollar deals happen without greasing a few palms. These software packages are so awful and require millions more in consulting beyond the license price -- I can't see any technically oriented person supporting their purchase without some inducement. In this case, it was a direct bribe that the sales team thought they could get away with.
Most software companies slip these things under the table through channels that don't legally qualify as bribes. Ever wonder why horrible expensive software packages are sometimes called "golf course ware?" It's a dirty business and things like paying for some kid of an exec's school tuition, or rounds and rounds of strip club visits, or golf, or "educational product seminars" in Aruba is just cost of sales for these companies. It's kind of like lobbyists -- they can't legally hand a Congressperson a paper bag full of money, but they can sure make things happen for them behind the scenes that are the equivalent of the paper bag.
Part of me wishes I was a CTO so I could just line up the vendors and collect bribe after bribe...oops, sorry, "favor" after "favor." Then again, I've worked with some of this horrible software (SAP, Oracle, etc.) and the awful botton-of-the-barrel offshored or H-1B management consultants they send in to "implement" them. No wonder everyone outside of large businesses wants nothing to do with big monolithic packages!!
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No wonder everyone outside of large businesses wants nothing to do with big monolithic packages!!
That's not what she said!
That really stinks (Score:2)
I knew German software was bad, but they really have to PAY people to use it?
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International anti-bribery laws are dysfunctional (Score:3, Interesting)
In the international marketplace, all anti-bribery laws do is put European and American countries at a disadvantage. Do you think China or India are paying the slightest bit of attention to anti-bribery laws?
All such laws do is force companies to relocate to the Bahamas or somewhere like it for "greater operational flexibility" (i.e. legal bribery) in order to compete.
You're not going to get rid of corruption in Nigeria, Venezuela or Kazakhstan by passing some dimwitted do-gooder laws in Europe or the USA. It's ineffective and self-defeating.
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Who said they want to get rid of corruption, in general? SAP is a German company and in Germany it's perfectly legal to bribe a foreign official. It makes the exports more "competitive" and it's good for the German economy. Anti-bribery laws is Germany are only concerned about bribing German officials, thus putting the country at an advantage, not a disadvantage. See what state Greece is in? Maybe you want to read on the bribing of Greek officials by Siemens. (Disclaimer: I'm Greek living in Germany)
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So the solution is to double down on corruption? Your cynicism accomplishes nothing.
The only reason you have some level of accountability for these crimes, yes they are crimes, is to actively fight those attempting to perpetrate them. They may be largely ineffective for some scenarios, but it makes the world vastly better as a whole if it wasn't. Fifa scandle being the latest most notable example would never happen if we sat on our hands letting people have free reign. Want someone killed? Slip some cash in
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Double down? No. Accept it as reality as it is? Yes, I'm for that.
Corruption is a universal in human societies, including ours in the USA. The issue Solutions to change that have the potential to be *far* worse than the original problem. Corruption can be discouraged effectively only by removing everyone's privacy and allowing the government immediate electronic access to all financial transactions and by banning all non-electronic financial transactions. No cash. No gold.
Do you want that? Really? Because t
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Impossible position (Score:2)
International corporations are in an impossible position with it comes to bribes. I don't know if it's the case in Panama, but in many countries refusing to pay bribes is the same thing as refusing to do business in that country. If all your competitors are paying bribes, what are you supposed to do?
When the US Congress passed a law making it illegal for domestic companies to pay bribes to foreign government officials US companies were shut out of billions of dollars in African contracts. Is the world
Who didn't pay bribes .. (Score:2)