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By | John Oates 15th April 2010 08:59

HP fingered in bribe probe

Germany and Russia raid Moscow HQ

HP's headquarters in Moscow were raided by Russian investigators yesterday looking for evidence the computer giant bribed its way to victory in a big contract.

The raids were ordered by German authorities, investigating because the payments are believed to have been made via a German HP subsidiary.

The ink giant is suspected of paying €8m in bribes in order to secure a €35m contract to provide Russian prosecutors with a secure communications system. Whether these are the same prosecutors who are now investigating HP is not clear.

A spokesman for German prosecutors told the Wall Street Journal they were looking at allegations of breach of trust, tax evasion, money laundering and the creation of a slush fund.

Any serious probe could well spark a parallel investigation by the US Securities and Exchange Commission.

Sources told the WSJ that Swiss and German police first went after 10 HP executives back in December when search warrants were issued. HP told the paper it cooperated with that investigation.

German investigators traced money to accounts in the UK and Delaware and are now on the trail of accounts in Wyoming, New Zealand and the British Virgin Islands. Police are currently going through thousands of emails relating to the ten individuals.

The case is further muddied because the 2003 contract between HP and the Russian prosecutor general was signed by an HP executive who is remaining silent and an unknown Russian official - the signature is illegible.

An HP spokeswoman said: “This is an investigation of alleged conduct that occurred almost seven years ago, largely by employees no longer with HP. We are cooperating fully with the German and Russian authorities and will continue to conduct our own internal investigation.”®

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