US ATM manufacturer Diebold has agreed to pay $48 million to settle criminal and civil charges that it handed over millions of dollars in bribes to bank officials in China, Indonesia and Russia.
According to the SEC, Diebold units in China and Indonesia spent around $1.8 million on travel, entertainment, and other improper gifts for senior officials with the ability to influence banks' purchasing decisions.
Between 2005 and 2010, government-owned bank officials in China and Indonesia were rewarded with free trips to US and European tourist destinations such as the Grand Canyon and Disneyland. Diebold's subsidiary in China also gave dozens of government bank officials annual cash gifts ranging from less than $100 to more than $600.
The vendor is also accused of paying employees of private Russian banks $1.2 million in bribes in connection to ATM sales. The cash was funnelled through a distributor in Russia using phony service contracts to hide and falsely record the payments as legitimate business expenses.
Acting assistant attorney general Mythili Raman says: "In China, Indonesia and Russia, Diebold chose to pay bribes for business and falsify documents to cover its tracks. Through its corrupt business practices, Diebold undermined the sense of fair play that is critical for the rule of law to prevail."
Diebold has agreed to pay $22.9 million in disgorgement and prejudgment interest to settle the SEC charges. It will also pay a $25.2 million fine to settle criminal proceedings, with the Department of Justice agreeing to defer prosecution for three years. If Diebold abides by the terms of the agreement, the department will dismiss the criminal information.