Welcome!

Log Management Authors: Dana Gardner, Pat Romanski, Elizabeth White, David H Deans, Carmen Gonzalez

Related Topics: @CloudExpo, IBM Cloud, Log Management, Government Cloud

@CloudExpo: Article

HP Under Investigation in Germany & Russia for Bribery

HP's Russian headquarters in Moscow were tossed Wednesday by the investigative arm of the Prosecutor General's Office

HP's Russian headquarters in Moscow were tossed Wednesday by the investigative arm of the Prosecutor General's Office at the request of German authorities according to reports by both Reuters and the Wall Street Journal.

It appears from the story the Journal has managed to piece together that German prosecutors in Dresden are investigating whether HP officials paid about €8 million ($10.9 million) in bribes to win a €35 million contract back in 2003, the Carly Fiorina era already infamous for the way it went about trying to stop boardroom leaks to the press, a case that brought down HP chairman Patricia Dunn and led to a Congressional investigation.

Ironically the deal was with the very Prosecutor General's Office in Russia that searched its offices. And equally ironically the Russian Prosecutor General's Office is charged with criminal prosecutions, including many corruption cases, the Journal says.

Germany reportedly comes into it because the state-of-the-art computer system sold to the Russians moved through a German subsidiary of HP's.

The system was reportedly designed to provide secure communications for prosecutors throughout Russia and included notebooks, workstations and servers.

From what the Journal has managed to find out, the Germans have been investigating for months and following the dollars through what the paper - reading documents submitted to a German court - calls "a network of shell companies and accounts in places including Britain, Austria, Switzerland, the British Virgin Islands, Belize, New Zealand, the Baltic nations of Latvia and Lithuania, and the US states of Delaware and Wyoming."

The Germans are reportedly investigating "allegations of breach of trust, tax evasion and money-laundering and whether money was funneled out of HP accounts to create a slush fund," the Journal says.

The investigators have reportedly yet to figure out who was allegedly bribed. They can't even read the Russian signature on the contract. That's why they're rooting through a reported "3,000 e-mails and thousands of pages of additional evidence" looking for who benefits on either sides of the deal.

The paper notes that the SEC could start a parallel investigation since the Foreign Corrupt Practice Act prohibits US companies from bribing foreign officials.

Or it could if it was informed about what was going on but the news has yet to wend its way into an HP filing with the SEC although, according to what the paper heard from "two people familiar with the investigation," HP has known about the investigation since at least December when it was served with search warrants in both Germany and Switzerland "detailing allegations against 10 [unidentified] suspects."

HP seems to have hinted however. The Journal says its last SEC filing on March 11 "gave a non-specific warning to its investors that ‘in many foreign countries' illegal business practices are ‘common.' Such actions, undertaken ‘in violation of our policies...could have a material adverse effect on our business and reputation.'"

In Germany a company can't face criminal charges, but it can be made to disgorge illicit profits if it benefits from a crime. Bribes used to be tax-deductible in Germany.

HP is giving everybody the same statement: "This is an investigation of alleged conduct that occurred almost seven years ago, largely by employees no longer with HP. We are co-operating fully with the German and Russian authorities and will continue to conduct our own internal investigation."

Coming in on the Journal's tail, the Financial Times said early Thursday that after the December raids in Germany three HP managers were arrested but released on bail. At least two of them have left the company and the six others under investigation are managing directors of the shell companies believed to have funneled the money. It claims nine people are implicated.

The FT says the investigation started when a garden-variety audit of a small firm in Leipzig uncovered suspicious payments.

German tax authorities, on the trail of undeclared income, brought down the CEO of Deutsche Post two years ago for tax evasion.

Editor - We received the following statement from HP on April 15, 9:21 am regarding this subject

HP Statement (attributed to an HP spokesperson):

"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."

More Stories By Maureen O'Gara

Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

Comments (0)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


@ThingsExpo Stories
Michael Maximilien, better known as max or Dr. Max, is a computer scientist with IBM. At IBM Research Triangle Park, he was a principal engineer for the worldwide industry point-of-sale standard: JavaPOS. At IBM Research, some highlights include pioneering research on semantic Web services, mashups, and cloud computing, and platform-as-a-service. He joined the IBM Cloud Labs in 2014 and works closely with Pivotal Inc., to help make the Cloud Found the best PaaS.
Cloud-enabled transformation has evolved from cost saving measure to business innovation strategy -- one that combines the cloud with cognitive capabilities to drive market disruption. Learn how you can achieve the insight and agility you need to gain a competitive advantage. Industry-acclaimed CTO and cloud expert, Shankar Kalyana presents. Only the most exceptional IBMers are appointed with the rare distinction of IBM Fellow, the highest technical honor in the company. Shankar has also receive...
"Evatronix provides design services to companies that need to integrate the IoT technology in their products but they don't necessarily have the expertise, knowledge and design team to do so," explained Adam Morawiec, VP of Business Development at Evatronix, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Business professionals no longer wonder if they'll migrate to the cloud; it's now a matter of when. The cloud environment has proved to be a major force in transitioning to an agile business model that enables quick decisions and fast implementation that solidify customer relationships. And when the cloud is combined with the power of cognitive computing, it drives innovation and transformation that achieves astounding competitive advantage.
The Founder of NostaLab and a member of the Google Health Advisory Board, John is a unique combination of strategic thinker, marketer and entrepreneur. His career was built on the "science of advertising" combining strategy, creativity and marketing for industry-leading results. Combined with his ability to communicate complicated scientific concepts in a way that consumers and scientists alike can appreciate, John is a sought-after speaker for conferences on the forefront of healthcare science,...
Data is the fuel that drives the machine learning algorithmic engines and ultimately provides the business value. In his session at Cloud Expo, Ed Featherston, a director and senior enterprise architect at Collaborative Consulting, discussed the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
Explosive growth in connected devices. Enormous amounts of data for collection and analysis. Critical use of data for split-second decision making and actionable information. All three are factors in making the Internet of Things a reality. Yet, any one factor would have an IT organization pondering its infrastructure strategy. How should your organization enhance its IT framework to enable an Internet of Things implementation? In his session at @ThingsExpo, James Kirkland, Red Hat's Chief Archi...
The current age of digital transformation means that IT organizations must adapt their toolset to cover all digital experiences, beyond just the end users’. Today’s businesses can no longer focus solely on the digital interactions they manage with employees or customers; they must now contend with non-traditional factors. Whether it's the power of brand to make or break a company, the need to monitor across all locations 24/7, or the ability to proactively resolve issues, companies must adapt to...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settl...
Organizations planning enterprise data center consolidation and modernization projects are faced with a challenging, costly reality. Requirements to deploy modern, cloud-native applications simultaneously with traditional client/server applications are almost impossible to achieve with hardware-centric enterprise infrastructure. Compute and network infrastructure are fast moving down a software-defined path, but storage has been a laggard. Until now.
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, discussed how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team at D...
DXWorldEXPO LLC announced today that the upcoming DXWorldEXPO | CloudEXPO New York event will feature 10 companies from Poland to participate at the "Poland Digital Transformation Pavilion" on November 12-13, 2018.
Digital Transformation is much more than a buzzword. The radical shift to digital mechanisms for almost every process is evident across all industries and verticals. This is often especially true in financial services, where the legacy environment is many times unable to keep up with the rapidly shifting demands of the consumer. The constant pressure to provide complete, omnichannel delivery of customer-facing solutions to meet both regulatory and customer demands is putting enormous pressure on...
The best way to leverage your CloudEXPO | DXWorldEXPO presence as a sponsor and exhibitor is to plan your news announcements around our events. The press covering CloudEXPO | DXWorldEXPO will have access to these releases and will amplify your news announcements. More than two dozen Cloud companies either set deals at our shows or have announced their mergers and acquisitions at CloudEXPO. Product announcements during our show provide your company with the most reach through our targeted audienc...
JETRO showcased Japan Digital Transformation Pavilion at SYS-CON's 21st International Cloud Expo® at the Santa Clara Convention Center in Santa Clara, CA. The Japan External Trade Organization (JETRO) is a non-profit organization that provides business support services to companies expanding to Japan. With the support of JETRO's dedicated staff, clients can incorporate their business; receive visa, immigration, and HR support; find dedicated office space; identify local government subsidies; get...
DXWorldEXPO LLC announced today that All in Mobile, a mobile app development company from Poland, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. All In Mobile is a mobile app development company from Poland. Since 2014, they maintain passion for developing mobile applications for enterprises and startups worldwide.
@DevOpsSummit at Cloud Expo, taking place November 12-13 in New York City, NY, is co-located with 22nd international CloudEXPO | first international DXWorldEXPO and will feature technical sessions from a rock star conference faculty and the leading industry players in the world.
"Akvelon is a software development company and we also provide consultancy services to folks who are looking to scale or accelerate their engineering roadmaps," explained Jeremiah Mothersell, Marketing Manager at Akvelon, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
As data explodes in quantity, importance and from new sources, the need for managing and protecting data residing across physical, virtual, and cloud environments grow with it. Managing data includes protecting it, indexing and classifying it for true, long-term management, compliance and E-Discovery. Commvault can ensure this with a single pane of glass solution – whether in a private cloud, a Service Provider delivered public cloud or a hybrid cloud environment – across the heterogeneous enter...
DXWorldEXPO LLC announced today that ICC-USA, a computer systems integrator and server manufacturing company focused on developing products and product appliances, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. DXWordEXPO New York 2018, colocated with CloudEXPO New York 2018 will be held November 11-13, 2018, in New York City. ICC is a computer systems integrator and server manufacturing company focused on developing products and product appliances to meet a wide range of ...