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Microsoft pays $25m to settle Hungarian bribery charges

Microsoft pays $25m to settle Hungarian bribery charges

MICROSOFT IS HAVING to cough up some serious money to settle crimes committed abroad. The tech giant has agreed two payments totalling $25m (about £20.1m) that will be split between the Security & Exchange Commission (SEC) and the Justice League of America Department over bribery charges in Hungary. Under the Foreign Corrupt Practices Act, Microsoft was found to

MICROSOFT IS HAVING to cough up some serious money to settle crimes committed abroad.

The tech giant has agreed two payments totalling $25m (about £20.1m) that will be split between the Security & Exchange Commission (SEC) and the Justice League of America Department over bribery charges in Hungary.

Under the Foreign Corrupt Practices Act, Microsoft was found to have offered discounted prices to resellers between 2013 and 2015, whilst the money saved allowed the companies in question to fund bribes of government officials and executive kickbacks which in some cases actually gained Microsoft some tasty contracts.

Although the bulk of the japes happened in Hungary, the investigation also found that subsidised travel and gifts offered by subsidiaries in Saudi Arabia and Thailand were “improper”, whilst Turkey offered discounts described as “excessive”.

In other words, the practice was widespread, but Hungary yields the smoking-est gun.

In an open letter to staff, Brad Smith, Microsoft president, spoke of his disappointment with the situation, in a message headed: “There is no room for compromise when it comes to ethical business practices” (a bit long for a subject line there, Brad, but we forgive you):

“We recognise that no business process can offer a perfect guarantee of eliminating all global instances of a human frailty that is as old as humanity itself.

“That’s why we need strong laws and effective enforcement by agencies such as the DOJ and the SEC in the United States and around the world. And it’s why across the business community we need not only to be vigilant but committed to putting the world’s most advanced technology to work to help fulfil the strong ethical principles that the public rightfully expects us to uphold.”

He added that all those involved in the tomfoolery have been removed from the company payroll. Some companies tried to sue Microsoft for doing the right thing in going public, claiming they had lost revenue and business as a result. Microsoft eventually prevailed and has added that the company would not be working with companies that were found guilty of the transgressions. μ

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