Thursday, November 10, 2011

Heckler & Koch Headquarters Searched by Police in Germany Amid Bribery Allegations

As many as 300 German police officers searched the headquarters of Heckler & Koch, based in Oberndorf, near Stuttgart, earlier today (November 10) based upon allegations that the German arms maker bribed Mexican officials during 2005-2010 to boost its sales. The investigation also includes whether any German executives of the company were bribed.

H&K is already under investigation for allegedly providing its G36 assault rifle to Mexican police in the states of Chiapas, Chihuahua, Guerrero and Jalisco, where Germany prohibits such exports over alleged human rights violations. H&K maintains it did not deliver weapons to those four states, but only to the country's Mexico City-based central weapons purchasing authority, which is overseen by the Defense Ministry.

COMMENT: Heckler & Koch is also under investigation following the discovery of its assault rifles in Libya. The company contends that the weapons found in Libya were part of a legitimate arms shipment sent to Egypt in 2003.

In 2010, A Munich court on Tuesday found two former senior executives of Germany's Siemens' guilty of breach of trust and abetting bribery. Both paid fines approaching US$250,000 for bribing officials in Russia and Nigeria, but collectively Siemens paid officials in various countries roughly US$1.8 billion during 2000-2006. Consequently, Siemens was forced to pay nearly 2.5 billion euros for bribery investigations in the US and Germany.

Also in 2010, Stuttgart-based carmaker Daimler also came under investigation on both sides of the Atlantic for bribing foreign government officials with money and gifts to win contracts. As a result, it was forced to pay US$185 million (137 million euros) to settle US charges brought by the Justice Department and the Securities and Exchange Commission (SEC).

As a result of such large bribery cases in recent years, German prosecutors have cracked down on allegations of bribery, which is why H&K has come under the spotlight of German authorities.

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