EU – Baltic States, Latvia, Legislation, Transport, USA

Daimler admitted to making hundreds of improper payments worth tens of millions of dollars to foreign government officials in at least 22 countries between 1998 and 2008, according to a deferred prosecution agreement filed in a Washington court, writes LETA referring to AFP.

The kickbacks of cash and gifts of luxury armored cars, golf clubs and vacations helped secure government contracts worth millions of dollars in China, Russia, Thailand, Greece, Iraq and other countries, including Latvia.

Viktors Troicins, director of Latvian Daimler dealer Domenikss, told the business portal Nozare.lv that his company was in no way connected with the payment of bribes by Daimler.

Troicins indicated that the competitions won by Domenikss were down to honest and accountable business practices, quality products, and attractive prices and service conditions.

The Domenikss director added that his company was only one of a number of companies to have represented Daimler in Latvia between 1998 and 2008.

He added that Daimler had placed a restriction on more detailed comment until it announces its own official position on April 1 following the hearing in the U.S.

Prosecutors have recommended that a judge impose a USD 93.6 million fine and accept the guilty plea of two Daimler subsidiaries. They noted that Daimler has mended its ways and cooperated fully with the investigation.

Daimler will also pay a USD 91.4 million fine to settle an investigation by the US Securities and Exchange Commission.

Daimler regularly presented its findings to prosecutors, fired 45 employees implicated in the bribery and reformed its practices, prosecutors wrote.

Daimler, maker of "Mercedes-Benz" cars and the world leader in heavy trucks, admitted to engaging in a "longstanding practice of paying bribes" to foreign officials, court records show.

The bribes included:

• More than EUR 3.0 million (USD 4.0 million) to Russian government officials in order to secure EUR 64.6 million (USD 86 million) in sales.
• EUR 4.1 million in "commissions," "gifts" and lavish vacations to Chinese government officials.
• A "birthday gift" of a USD 300,000 armored Mercedes Benz S-class car to an official in Turkmenistan.
• Kickbacks to Iraqi officials and an agreement not to seek compensation for damages incurred during the first Gulf War in order to secure sales of trucks used for humanitarian purposes through the UN's Oil for Food program.
• Golf clubs, wedding gifts and other perks totaling about USD 41,000 dollars to win contracts in Indonesia.