Daimler agrees to pay $185m after admitting to bribery charges. These charges were made by the US Justice Department and Securities and Exchange Commission on the strength of an investigation into the company’s global sales practices.
The question that needs answering is why the US would charge a German company for bribery they committed in foreign countries i.e. not in the USA. Is this the American way of bringing in money to fund it’s various financial bail-out activities or job creation programmes one wonders.
The crimes were committed by Daimler’s German-based exports subsidiary Export and Trade Finance and the Russian business Mercedes-Benz in Russia. So how does the USA fit into this picture?
Is this now the moral police or is it a money making racket by the US government agencies.
Now there is no doubt that Daimler paid out bribes. Daimler has no problem with admitting to this. They also state that they are cleaning up their house and a fair number of people have been fired.
So the issue is not whether Daimler paid a bribe or not. It’s accepted that they did and on many occasions. The issue centres around why the USA should think they are the world wide morals police and how they come to be charging this company operating in another country. Surely the German government should have brought this action?
But talking about bribery and corruption, the USA is not exactly the country of virtue and lily white hands. Alone the lobbying industry so popular in Washington smacks of bribery and corruption. But if one gives it a name and places it in broad daylight for all to see then suddenly it isn’t bribery anymore. Is bribery only bad if it’s done underhand?
However, going back to the issue of jurisdiction because this is what it’s about after all, does this process recently completed in the USA mean that anybody bribing somebody in the rest of the world can be charged in the USA?
Your company is registered and headquartered in Vietnam for instance where bribery and corruption is part of doing business. It’s an overhead. Don’t open a business if you are not going to pay bribes.
Suddenly you get fined by the US Justice Department and Securities and Exchange Commission. You’ve been caught paying bribes. Well yes, it’s the only way to do business in Vietnam. Can’t exist without it. Even non-profits have to play the bribery game.
But the US Justice Department calls it a crime and you get fined. Is anybody safe from the long arm of this particular law enforcement agency?
Daimler’s case is not an isolated incident. German industrial group Siemens paid $800m in 2008 to settle a US investigation into bribes paid by the company to government officials in Argentina, Bangladesh, Iraq and Venezuela.
That’s almost $1bn.. Will come in handy when trying to balance the budget in the US one supposes.
A few years of this kind of moral policing and collection of revenue could end up being quite lucrative to the US government. Might allow them to pay for all the bail-outs that have to be made to thieving, lying and law-bending US based banks, insurance companies and other financial institutions.