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Siemens corruption probe widens to Indonesia, China: report

The cash-for-contracts probe at German concern Siemens has widened to include investigations into illicit payments in Indonesia and China, weekend reports said.

The news magazine Der Spiegel reports in its forthcoming issue that payments to the value of €20 million ($27 million) could have been channeled through a Lichtenstein account in relation to a coal-fired power station in Indonesia. Siemens auditors had found evidence of payments relating to the construction and operation of the 1,200-Megawatt Paiton II station in eastern Java, Der Spiegel reports. The contract was worth some $1.2 billion and was signed in the presence of former chancellor Helmut Kohl and former Indonesian leader Suharto in April 1995. According to the weekly WirtschaftsWoche, Siemens bosses in China are largely running their own affairs independently of company headquarters in Munich. The activities of the Chinese managers and their illicit payments had come to the attention of the company auditors, the weekly said. Siemens declined to comment.

Last week, the Munich-based Sueddeutsche newspaper said auditors had found illicit payments dating back to the early 1990s totaling more than a billion euros, some three times more than previously reported. Internal auditors have been probing the company since December as part of a corruption affair in which payments were made in order to secure contracts. Some €900 million ($1.2 billion) were linked to the communications division, as opposed to the €420 million acknowledged earlier by Siemens, the report said. Illicit payments at the power generation division came to €250 to 300 million. Two former Siemens managers in the power generation division received suspended sentences from a German court in May related to the payment of more than €6 million in bribes to two managers of the Italian energy concern Enel with the aim of securing contracts for Siemens gas turbines. (