Microsoft Investigated Over Bribery Claims – Report

Tom Brewster is TechWeek Europe's Security Correspondent. He has also been named BT Information Security Journalist of the Year in 2012 and 2013.

Microsoft facing claims its partners took bribes in China, Italy and Romania to gain government contacts

Microsoft business practices have caught the baleful glare of the US government again, with regulators looking into claims of kickbacks from partners in China, Romania and Italy, according to a report.

There have been no official charges from the regulators involved, including the Department of Justice and the Securities and Exchange Commission (SEC). But preliminary investigations are underway, looking into potential breaches of the Foreign Corrupt Practices Act.

In 2012 a former company representative made allegations that bribes had been paid to government officials for IT contracts, according to the Wall Street Journal, which cited people familiar with the matter.

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The supposed whistleblower is believed to have worked for Microsoft in China until 2008 and to have been in a labour dispute with Microsoft.

Microsoft is believed to have conducted an investigation in 2010 into the situation in China, and found nothing illegal going on.

In Italy, customer loyalty programme consultants are alleged to have given special treatment to certain customers to score government contracts. Whilst in Romania, the spotlight is on dealings between resellers and the nation’s Ministry of Communications.

Microsoft responded to the reports in a blog post, in which John Frank, vice president and deputy general counsel, said the company cooperated on all compliance issues.

“The matters raised in the Wall Street Journal are important, and it is appropriate that both Microsoft and the government review them. It is also important to remember that it is not unusual for such reviews to find that an allegation was without merit,” Frank said.

“In a community of 98,000 people and 640,000 partners, it isn’t possible to say there will never be wrongdoing.

“Our responsibility is to take steps to train our employees, and to build systems to prevent and detect violations, and when we receive allegations, to investigate them fully and take appropriate action. We take that responsibility seriously.”

There have been a number of bribery probes involving major tech firms in recent years. One of the more significant cases saw Dell settling after it was accused of taking bribes from Intel to include its chips in the Texan firm’s hardware.

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