“The probe is about the TM employees who allegedly took US$700,000 in bribes, not about Alcatel Lucent,” a source told The Malaysian Insider.He said MACC is expected to call up TM officials to help in the probe that began last week after the United States’ Securities and Exchange Commission (SEC) and the Department of Justice (DoJ) fined ALU US$137 million for a global bribery case.
A spokesman for Alcatel-Lucent said in an emailed media statement, “It would be inappropriate for us to comment on this, other than to say we will cooperate with investigations.”“We have a zero-tolerance policy regarding bribery and corruption and a system in place with strong processes and training designed to prevent these types of situations in all aspects of our business,” added the statement carried by the Wall Street Journal.
TM and Axiata Group Bhd have jointly appointed KPMG Corporate Services Sdn Bhd as forensic accountants to help in an internal probe into US$700,000 paid for “non-public information” that helped the telecommunications equipment maker win the contract.The information is said to be related to competitors’ pricing and bids, believed to be for TM’s then-subsidiary Celcom Malaysia’s new 3G mobile services which were launched in 2005.
Both companies also jointly announced the appointment of Shearn Delamore & Co as legal adviser to assist investigations.TM, in a filing to Bursa Malaysia on Monday also named board member and chairman of the board risk committee Tunku Mahmood Fawzy Tunku Muhiyiddin as chairman of the board audit committee (BAC) into the affair.The other two members of the sub-committee are senior management members who were not involved in the procurement process during the period in question.
“As the period under investigation concerns the previous integrated TM Group, TM is working closely with Axiata Group Berhad (Axiata) to extend all necessary co-operation with the relevant parties and authorities,” said Telekom Malaysia in its filing.Axiata named David Lau Nai Pek as its BAC chairman in a separate filing, also issued late last night.The SEC and DoJ had revealed that between December 2001 and June 2006, Alcatel used consultants who funnelled more than US$8 million in bribes to officials, and Alcatel also improperly hired third-party agents in countries like Nigeria to help win deals.Overall, the company admitted it earned about US$48.1 million in profits as a result of the improper payments, the US Justice Department said.
The company agreed to pay US$92 million to settle the criminal charges filed by the Justice Department and also pay more than US$45 million to settle the SEC’s civil charges.In 2006, France’s Alcatel bought Lucent Technologies Inc, including its famous Bell Laboratories, which was the pioneer of many communications technologies. The company said the bribery violations occurred before the combination.The filing on Malaysia titled “The Malaysia Bribery Scheme” was eight paragraphs long and reported that “from October 2004 to February 2006, Alcatel bribed government officials in Malaysia to obtain confidential information relating to a public tender that Alcatel ultimately won, the result of which yielded a telecommunications contract valued at approximately US$85 million.”
The filing said the TM employees who received bribes were “foreign officials” within the meaning of the US Foreign Corrupt Practises Act and “were in a significant position to influence the policy decisions Telekom Malaysia made.”It added the Basel-based Alcatel Standard made significant lump-sum payments through US bank accounts to two consultants labelled “Malaysian Consultant A” and “Malaysian Consultant B”, purportedly for market research.
“Alcatel Standard paid US$200,000 to Malaysian Consultant A in 2005 for a series of ‘market reports’ describing conditions in the Malaysian telecommunications market. Similarly, Alcatel Standard paid US$500,000 to Malaysian Consultant B in 2005 for a ‘strategic intelligence report’.“However, the work product these consultants prepared could not justify the size of Alcatel Standard’s payments. In fact, Malaysian Consultant A and Malaysian Consultant B did not appear to render any legitimate services to Alcatel Malaysia in connection with these payments,” the filing said.The case is the latest in a series of bribery cases brought by the Obama administration to crack down on illegal payments by businesses to win contracts.
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