HP caught in Russian bribery scandal

HEWLETT-Packard has been very, very naughty. The tech giant has been caught bribing Russian government officials. And now they have to pay.

FILE - This Feb. 21, 2012 file photo shows a Hewlett Packard logo in Frisco, Texas. Hewlett-Packard said Wednesday, May 23, 2012 that it's laying off 27,000 workers, 8 percent of its work force, as it restructures the business. The Palo Alto, Calif., company said it'll save $3 billion to $3.5 billion annually from cost cuts, including the layoffs. Hewlett-Packard Co. expects to complete the job cuts by the end of fiscal 2014. (AP Photo/LM Otero, File)

HEWLETT-Packard Co. pleaded guilty Thursday to felony charges that former employees bribed Russian government officials for a contract, and the company has been fined $64.78 million ($US58.7 million).

Hewlett-Packard’s Russian subsidiary admitted violating the Foreign Corrupt Practices Act in a Northern California court Thursday, the U.S. Department of Justice said in a statement.

The U.S. alleged that the HP division paid $2 million to retain a technology contract with Russian prosecutors.

“In a brazen violation of the FCPA, Hewlett-Packard’s Russia subsidiary used millions of dollars in bribes from a secret slush fund to secure a lucrative government contract,” said Principal Deputy Assistant Attorney General Marshall L. Miller. “Even more troubling was that the government contract up for sale was with Russia’s top prosecutor’s office.”

The plea and sentence are part of a larger agreement reached in April with the Justice Department and the Securities and Exchange Commission. HP agreed to pay a total of $108 million in criminal and civil penalties for bribing officials in Russia, Mexico and Poland.

Representatives of the Palo Alto, California, company did not immediately reply to after-hours phone and email messages seeking comment.

HP’s general counsel, John Schultz, said when the settlement was reached in April that the misconduct was limited to a small number of people who are no longer with the company.

Originally published as HP caught in Russian bribery scandal