Alliance, other insurers to foot Siemens' corruption bill: report
29 April 2008
Mumbai: An insurance group comprising Allianz and others will have to pay up to 250 million euros ($390 million) as part of the management liability costs of a corruption case involving Siemens AG, Financial Times Deutschland said in a report.
Siemens had reported up to 250 million euros ($390 million) in damages to the group of insurers, with which it had taken out directors' and officers' (D&O) liability insurance for the years 2004 to 2007, the report said without citing sources.
The other insurers in the consortium include Zurich Financial Services and HDI-Gerling. The share of possible damages falling on Allianz alone was 70 million euros, it said.
The scandal, which involved hundreds of millions of euros in bribes used to win contracts over a period of several years, had cost Siemens 1.6 billion euros so far.
The affair, being investigated by US and German authorities, had led to the resignation of the Siemens' chief executive and chairman last year and the head of its healthcare division last week.
No one has been accused of any personal wrongdoing although Siemens could itself pursue former executives suspected of having ignored or tolerated allegedly widespread corruption within the company.
Under this DO insurance policy, companies seek to protect management board and supervisory board members against possible damages claims, the newspaper said.
Siemens, meanwhile, has uncovered evidence of systemic use of slush funds to win contracts over a number of years in an in-house probe.