Microsoft Corporation (NASDAQ:MSFT) bribe probe has now been linked to Russia and Pakistan, which indicates that the matter is actually not confined to just a few contracts but has a wider reach than was previously anticipated, according to a report from The Wall Street Journal.
Microsoft is under investigation in the United States for alleged relationships with business partners who bribed foreign officials in return for contracts.
Microsoft alleged of using unfair means in Russia, Pakistan
An unknown source in Russia told Microsoft Corporation (NASDAQ:MSFT) that resellers of its software are offering bribes to executives of a state owned company to secure a deal. In Pakistan, a tipster revealed that Microsoft certified a consulting firm to pay for a five day trip to Egypt, for a government official and his wife, to get a contract.
No accusations by the government yet
This year, according to reports, the United States Department and Securities and Exchange Commission (SEC) have begun primary investigations into a kickback allegation made by a Microsoft representative in China. Also, the agencies are scanning the company’s connection with various resellers and consultants in Romania and Italy.
As of now, no accusation has been made by the government against Microsoft Corporation (NASDAQ:MSFT) or any of its business partners, and there are possibilities that the probe can end with no charges being filed. There was no comment from the Justice Department or Securities and Exchange Commission.
Microsoft conducting internal investigation
John Frank, Microsoft vice president and deputy general counsel, said that all the accusations and matters are being taken seriously, and the company intends to cooperate fully in the government investigation.
“We sometimes receive allegations about potential misconduct by employees or business partners and we investigate them fully regardless of the source,” Frank added.
Additionally, he said that the company also invests massive amount on proactive training, monitoring and audits to make sure that their business operations all over the world meet the highest legal and ethical standards.
This is just one investigation out of dozens of such conducted by the United States under the Foreign Corrupt Practices Act (FCPA) according to which foreign companies are not allowed to pay bribes to foreign officials. Under the law, companies will also take all responsibility for improper payments made by others on their behalf.
Meanwhile, Microsoft Corporation (NASDAQ:MSFT) is conducting an investigation on its own end. Generally companies conduct an internal investigation and shell out millions of dollars in the process to track any potential violation of FCPA. After the investigation, results are presented before the government to avoid heavy penalties.