Law & Policy

In Face Of Bribery Allegations, Lucent Fires Four China Executives

Lucent Technologies Inc. has fired four executives in its Chinese operations after the company discovered potential violations of a U.S. law that bans the payment of bribes overseas, according to a company filing with the Securities and Exchange Commission.

The positions include the company's China operations president, chief operating officer, a marketing executive and a finance manager. The company said it "found incidents and internal control deficiencies" in its operations in China that potentially involve Foreign Corrupt Practices Act violations, which bars a U.S. company's foreign agent from making payments to foreign officials to obtain or retain business. It also requires the strict record keeping of transactions between companies.

Lucent said it believes the situation in China did not have an impact on its financial results, but admitted it couldn't determine how the move might affect its business in China. In the interim, Robert Warstler, the company's president of global sales, will run the operations.

The company's move is thought to reflect Lucent's reaction to an investigation launched by two U.S federal agencies last August over bribery allegations against the company in Saudi Arabia. Lucent undertook an internal audit of 23 other foreign countries, said the company in its SEC filing.

The wholly owned Beijing-based unit in China, formally known as Lucent Technologies (China) Co. Ltd., has 3,000 employees, the company said. Lucent China has eight regional offices, two Bell Labs branches and five research facilities, in addition to joint ventures and wholly owned enterprises. The unit manufactures telecommunications network equipment and solutions for the Chinese and international markets.

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