Russian Authorities Looking into both Daimler and Volkswagen

According to RBC Daily, the Russian Investigative Committee (under the Prosecutor General office) is examining whether criminal charges should be brought against government officials who allegedly received kickbacks with respect to public purchases of Mercedes Benz vehicles.  The Daimler story is now old news – we heard way back in April all about the company’s combined $180+ million settlement with the U.S. Department of Justice and Securities and Exchange Commission.  The case was significant because one of the subsidiaries to plead guilty in U.S. federal court was DaimlerChrysler Russia.  The case sparked interest and outrage in Russia and on Russian blogs, exemplified by a post from Alexei Navalny with the simple title – Who Did Daimler Pay?  According to RBC, we will know whether Mr. Navalny’s question will be answered within the next month, since the Investigative Committee must make a decision on whether to initiate a prosecution during this time period.

The article also reports that the Investigative Committee is looking into MVD purchases of VW vehicles, which is of course not a member of the Daimler family.  MVD allegedly purchased armored vehicles from VW, which did not meet the security and other standards.  Nevertheless, the vehicles were purchased at a 200% markup.  Like many German corporations, VW has had some corruption problems over the past few years, including the famous use of prostitutes, champagne, and Viagra to secure the support for wage concessions from worker representatives.  These practices began in the mid-1990s and continued through 2005, and it does not stretch the imagination to think that the Investigative Committee is reviewing a similar time period, especially since there was a lot of turnover in Russian officialdom during the same set of years.  Now that Cold War metaphors are back in vogue, you might call this the “Domino Theory” of corruption investigations in Russia.

Below is the article from RBC Daily

«Дело Daimler»  приросло Volkswagen Бизнес газета РБКdaily

«Дело Daimler» приросло Volkswagen
Пока идет проверка закупок Mercedes, силовики начали новое расследование
Как стало известно РБК daily, в Следственном комитете при прокуратуре (СКП) начата доследственная проверка по факту злоупотреблений со стороны российских чиновников при закупках автомобилей у немецкого концерна Daimler-Benz. Максимум через 30 дней должно быть принято решение о возбуждении уголовного дела либо об отказе в возбуждении. Эксперты… Читать далее >
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