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CRIME

Swedish-Swiss company ABB to pay 315 million dollars to settle charges over South Africa bribes

Swedish-Swiss industrial company ABB agreed to pay $315 million to settle US criminal charges that it bribed state-owned Eskom of South Africa over government contracts, the Department of Justice (DOJ) announced Friday.

ABB company
The Department of Justice announced that ABB agreed to pay 315 million dollars to settle US criminal charges that it bribed state-owned Eskom of South Africa. Photo by Ostap Senyuk / Unsplash

Two affiliates of ABB each pleaded guilty to one count of conspiracy to violate the US Foreign Corrupt Practices Act as part of a three-year deferred prosecution agreement, the US agency said of a settlement that was coordinated with government authorities in Switzerland, Germany and South Africa.

The issue concerns a troubled project near Johannesburg with the Kusile power station, the fourth largest coal-fired generator in the world, which has been fraught with allegations of graft. South Africa’s struggling power utility Eskom commissioned the plant in 2007.

In October eight people, including former Eskom CEO Matshela Koko, were arrested on corruption charges linked to the ABB work.

Illicit payments?

Between 2014 and 2017, ABB through its subsidiaries secured “multiple” government contracts, syphoning illicit payments through subcontractors associated with an official at Eskom, South Africa’s state-owned power company, the DOJ said.

“ABB worked with these subcontractors despite their poor qualifications and lack of experience,” the DOJ said in a news release. “In return, ABB received improper advantages in its efforts to obtain work with Eskom, including, among other benefits, confidential and internal Eskom information.”

ABB engaged in “sham” negotiations with the Eskom official and falsely reported the payments as legitimate business expenses, according to the press release.

ABB chief executive Bjorn Rosengren said the company has acted in the wake of the case by “launching a new code of conduct, educating employees and implementing an enhanced control system to prevent something similar from happening again.”

ABB: Zero tolerance to non-ethical behavior

In a statement, he said that ABB has “a clear zero tolerance approach to non-ethical behavior within our company.”

The US agency said the penalty was reduced 25 percent from the high end of the sentencing range in light of ABB’s “extraordinary” cooperation and “extensive” remediation efforts.

But the department noted that ABB had two earlier criminal FCPA resolutions in 2004 and 2010, as well as a guilty plea by an ABB entity for bid rigging in 2001.

The US law on foreign corrupt practices applies to foreign companies with US-issued stock, as is the case with ABB.

The company also settled a parallel civil case with the Securities and Exchange Commission.

Earlier Friday, the Swiss attorney general’s office said ABB was fined four million Swiss francs ($4.3 million) in the case. ABB said it hoped to reach a resolution with German authorities in the near term.

In total, ABB said the settlements totaled $327 million, and have been accounted for in the company’s third quarter financial results.

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CRIME

American arrested over stabbing attacks in Zurich

Swiss police are looking for people who witnessed the stabbings, which took place at two different locations in Zurich on Wednesday morning.

American arrested over stabbing attacks in Zurich

A 38-year-old American citizen reportedly stabbed two people in districts 5 and 1 one hour apart on Wednesday morning, fleeing after each attack, Zurich police said in a press release.

The first victim, whose injuries were severe enough to require emergency surgery, was stabbed at around 9.45 am on Hardturmstrasse, in the area of the VBZ tram stop Fischerweg.

The second attack occurred on Schweizergasse, near the Pestalozzi facility.

The police didn’t specify what the suspect used to attack his victims, just saying it was a “stabbing weapon.”

Based on witness descriptions, the suspect, whose identity beyond his nationality and age has not been released, was apprehended soon after the second attack and is now under investigation for “serious violent crime.”

It is also not known at this point whether the alleged attacker is a tourist or resident, whether he knew his victims, or what his motives were.

The police are asking anyone who witnessed either of the attacks to call them at (058) 648-4848.

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