Microsoft, Partners Probed Over Bribery Claims

c0lo writes "U.S. federal authorities are examining Microsoft's involvement with companies and individuals that allegedly paid bribes to overseas government officials in exchange for business. The United States Department of Justice and the Securities and Exchange Commission have both opened preliminary investigations into the bribery allegations involving Microsoft in China, Italy and Romania. The China allegations were first shared with United States officials last year by an unnamed whistle-blower who had worked with Microsoft in the country, according to the person briefed on the inquiry. The whistle-blower said that a Microsoft official in China directed the whistle-blower to pay bribes to government officials to win business deals. U.S. government investigators are also reviewing whether Microsoft had a role in allegations that resellers offered bribes to secure software deals with Romania's Ministry of Communications. In Italy, Microsoft's dealings with consultants that specialize in customer-loyalty programs are under scrutiny, with allegations that Microsoft's Italian unit used such consultants as vehicles for lavishing gifts and trips on Italian procurement officials in exchange for government business. In a blog post Tuesday afternoon, John Frank, a vice president and deputy general counsel at Microsoft, said the company could not comment about continuing investigations. Mr. Frank said it was not uncommon for such government reviews to find that the claims were without merit. Somehow, given the way OOXML became a standard, it wouldn't surprise me if it were an actual fire that caused this smoke."

Hate to defend M$ in any way, but

[Anonymous Coward]

The China allegations were first shared with United States officials last year by an unnamed whistle-blower who had worked with Microsoft in the country

I don't know who this "whistle blower" was (likely a government official who they didn't bribe well enough), but EVERY company that does business in China bribes. It's more than a way of life there, it's absolutely ubiquitous. The only reason you don't have to pay bribes to breathe there is because no government official has found a way to extract them yet (and they would if at all possible). To do business there, you have to start with the knowledge that the whole goddamn country is built on two things: bribes and lies. And if you're lucky, a generous enough bribe MIGHT get you SOME of the truth every now and then. It's worse than India and Russia combined.

Re:Hate to defend M$ in any way, but

[Anonymous Coward]

EVERY large company that does business ANYWHERE bribes.

ftfy

Are huge discounts almost like bribes?

[girlinatrainingbra]

Considering how frequently the MS sales people seem to present a new option with lower licensing prices whenever a city or governmental agency is about to jump ship and get on board with Linux, isn't that sudden presentation of huge discounts almost like a bribe? Yes, i know that a bribe goes to a separate person in order for a transaction to go through, but when you've got to discount your prices that much for people to buy your stuff, that doesn't seem like a good sign!
.
And before some idiot goes the other way and sez "gnu/linux must suck real bad since the only way they get people to take it is to give it away for free!", realize that the concept of Free software (with liberty) being free (of price and cost) is secondary to the freedom it gives to the end-user and the things that come back to the developer(s) with GNU-GPL-licensed software. The freedom is an inherent essence to free software. It's not priced at $zero because people don't want it. It's priced at $zero because the community of developers believes in giving away and sharing the fruits of their labor to the community of the world

Re:Are huge discounts almost like bribes?

[Anonymous Coward]

Discounts != Bribes, even if it's Microsoft offering them. It's called being competitive.

Simple

[characterZer0]

The issue here is that the US government is not getting (enough) bribes. This probe will make sure that gets rectified.

Re:Hate to defend M$ in any way, but

[juancn]

It is pervasive in many places. Since the US frowns upon US companies bribing foreign officials, there are many consulting firms local to the country in question that take care of the bribes. These are never mentioned explicitly, so the US company doesn't actually pay the bribes, it just pays the consulting firm. And the consulting firm takes care of the bribes. That way you have deniability.

Since the consulting firm is out of reach from the SEC et.al. discovery is a bitch and the cases cannot normally be pursued (unless you get one of the officials to testify, which is at least difficult).

Re:Hate to defend M$ in any way, but

[Anonymous Coward]

You are a complete idiot who is incapable of comprehending the English language.

Re:Hate to defend M$ in any way, but

[CannonballHead]

WTF do people learn in school today?

That they are special and should get what they deserve regardless of how hard they work? ;)

Re:Hate to defend M$ in any way, but

[NoKaOi]

And calling this "bribery" isn't always correct. "Extortion" is probably just as a appropriate at times.

Or, in the US, where it's called "campaign contributions" and "lobbying."