Alstom Fined In Swiss Corruption Case

Alstom subsidiary has been ordered to pay $42.7 million in fines and compensation to end a long-running corruption case.

BERN, Switzerland (AP) -- A subsidiary of French engineering company Alstom SA has been ordered to pay 39 million Swiss francs ($42.7 million) in fines and compensation to end a long-running corruption case in Switzerland, prosecutors said Tuesday.

The four-year probe centered on payments made by Alstom Network Schweiz AG to middlemen -- termed "commercial agents" by the company -- in return for securing government contracts to build power stations in 15 countries since the 1990s.

The Federal Prosecutors Office in Bern concluded that Alstom had failed to take necessary measures to prevent bribery of foreign officials in three of those countries: Latvia, Tunisia and Malaysia.

The Swiss subsidiary, which waived its appeal against the summary punishment, was fined 2.5 million francs and ordered to pay compensation and costs of 36.5 million francs, according to a statement by the prosecutors office.

Separate proceedings against France-based holding company Alstom SA were dropped after it cooperated in the Swiss investigation and agreed to pay a 1 million-franc reparation.

Alstom said it was satisfied with the outcome of the case, which it claimed had "concluded the absence of any system or so called slush funds used for bribery of civil servants to illegally obtain contracts."

It acknowledged that prosecutors had concluded that "improper payments were made to civil servants in Latvia, Malaysia and Tunisia."

"In two out of these three cases, Alstom itself would appear to be a victim of the actions of some of its employees, who would have benefited from kickbacks," the company said. "In the third one, Alstom was simply a subcontractor of a consortium."

Switzerland made bribery of foreign officials a criminal offense in 2003. Until then, the country was considered a hub for European companies seeking to funnel illegal payments to foreign officials.