Another day, another scandal in the auto industry. This time, it’s German carmaker Daimler AG and three of its subsidiaries who have ordered in a federal court in in Washington, D.C. to pay $185 million in criminal and civil penalties after pleading guilty to international bribery.
U.S. District Court Judge Richard Leon ordered Daimler to pay $93.6 million in criminal fines and $91.4 million in civil penalties.
According to court documents, Daimler AG and its subsidiaries in Germany, Russia, and China agreed to the filing of a single count of conspiracy to violate U.S. anti-bribery laws.
The Justice Department said Daimler, whose stocks trade on multiple exchanges in the U.S., “engaged in a long-standing practice of paying bribes to foreign government officials.”
Countries whose officials were bribed, according to the court documents: China, Croatia, Egypt, Greece, Hungary, Indonesia, Iraq, Ivory Coast, Latvia, Nigeria, Russia, Serbia and Montenegro, Thailand, Turkey, Turkmenistan, Uzbekistan, Vietnam and several others.
The Justice Department said the bribes were made “to assist in securing contracts with government customers for the purchase of Daimler vehicles.”
DaimlerChrysler, the world’s 13th-largest carmaker, was founded in 1998 when Mercedes-Benz manufacturer Daimler-Benz (1926–1998) of Stuttgart, Germany merged with the US-based Chrysler Corporation.
The buyout failed to produce the trans-Atlantic automotive powerhouse dealmakers had hoped for, and DaimlerChrysler announced on May 14, 2007 that it would sell Chrysler to Cerberus Capital Management of New York, a private equity firm that specializes in restructuring troubled companies.
The renaming of the company was approved in 2007 to Daimler AG in Europe and Chrysler LLC in the United States.
Daimler AG manufacturers cars and trucks under the brands of Mercedes-Benz, Maybach, Smart, Freightliner, among others.
Chrysler LLC filed for bankruptcy in 2009 and announced a partnership with Fiat.
International bribery? What a joke. I have done business in some of these countries and “bribes” are part of the system, otherwise you have “no business.” Just try to get your export containers into those countries without “paying” the necessary “Bribes.” Your container will just sit on the wharf costing time and money. That’s the reality of how things work in those countries.