Publication	Business Week
Date	2011-12-20
Reporter	Karin Matussek
Web Link	www.businessweek.com

Dec. 20 (Bloomberg) -- Ferrostaal AG was fined 140 million euros ($183 million) today by a Munich court in a bribery case related to the conduct of two former employees.

The fine is the result of an agreement between the company, prosecutors and the judges, court spokeswoman Margarete Noetzel said in an e-mailed statement. The sanction was issued as part of a verdict in the trial of two former company managers accused of paying bribes in Greece and Portugal.

Ferrostaal said at the beginning of the trial on Dec. 15 that it was willing to pay the fine, which was the result of “intensive negotiations.” The company said in a statement today that it would bear the consequences and pay the fine.

The two former company managers, identified only as Johann- Friedrich Ha., 73, and Hans-Dieter Mue., 73, were convicted of bribery and received suspended prison terms of two years. Ha. was also fined 36,000 euros and must pay 30,000 euros to charities to have the term suspended. Mue. was fined 18,000 euros and must pay 22,000 to charities, according to the statement.

Prosecutors had been probing Essen, Germany-based Ferrostaal, which manages the development of industrial and petrochemical plants, since 2009 to determine whether it bribed officials for contracts.

With acknowledgements to Karin Matussek and Business Week.

Who says crime doesn't pay?

The German citizens just earned 140 million Euros ($183 million) from this juristic person corporate criminal.

And the German charities just earned 52 000 Euros from this natural person criminals.

But what is sickening is that no one is doing jail time.

The main guilty party is not so much the juristic person corporate criminal, but the Ferrostaal Supervisory Board made up of live fleshy natural person criminals.

But they got two middle managers in their middle 70s to take the "punch" with low and suspended prison sentences and even lower fines.

They clearly chosen these two because the soft German criminal justice system would be both open to a plea arrangement and then give mercy to these two scapegoats.

And no German wants Ferrostaal to fail as a company because it would cost the German taxpayer the retrenchment costs of 700 employees.

So now this and other German corporate criminals Siemens, Mercedes Benz and Thyssen just go out into the global market to pillage and plunder and bring back the spoils to the Fatherland.

Meanwhile they should be rendered off God's fine earth and the guilty natural persons should serve 15 to 25 years in prison.

In China less level of corruption gets a death sentence.

Arrest, trial, sentence and appeal in two years and lethal injection or AK-47 round in the back of the head with the relatives getting a bill for the consumables.

Okay, we survived Nazism, Apartheid the Cold War and the Border War and so in the year of our Lord 2011 we are relatively  civilised and we don't judicially execute people for genocide, crimes against humanity, murder in the first degree, let alone corruption in the first degree.

But it is an entirely different matter with juristic and corporate criminals.

And one does even have to close them down the next day for their heinous crimes, but blacklist from doing business for 20 years and watch them have a slow, but dignified death.

And we South Africans may ask why Ferrostaal only was found guilty in respect of the Greek and Portuguese submarine deals?

What about the South African submarine deal?

Let's compare.

Greece

Greece, with a population of just 11 million, is the largest importer of conventional weapons in Europe­and ranks fifth in the world behind China, India, the United Arab Emirates and South Korea. Its military spending is the highest in the European Union as a percentage of gross domestic product. That spending was one of the factors behind Greece's stratospheric national debt.

The German submarine deal in particular, announced in March 2010 as the country lurched toward bankruptcy, has cast a spotlight on the Greek military budget and on the foreign vendors supplying the hardware. The deal includes a total of six submarines in a complicated transaction that began in 2001 a decade ago with German firms.

The military deals illustrate how Germany and other creditors have in some ways benefited from Greece's profligacy, and how that is coming back to haunt them.

http://www.lepointinternational.com/it/politica/europa/550-the-submarine-deals-that-helped-sink-greece-.html


The South African deal includes a total of three submarines in a complicated transaction that began in 1997 more than a decade ago with German firms.


Portugal

In November 2003 the German Submarine Consortium (GSC) was selected to supply the Portuguese State with the two submarines.

The contract was negotiated and signed in April 2004 by the Defence Minister of Prime Minister Durão Barroso, Mr.  Paulo Portas, for the price of 880 million Euro, plus an offsets contract in the amount of over 1 billion Euro (1 210 million).

The German Submarine Consortium was formed by the companies Howaldtswerke Deutsche Werft AG, Thyssen Nordseewerk GmbH and MAN Ferrostaal, of which the latter was to take care of the commercial and financial aspects of the contract, including the offset contracts, the identification of offset beneficiary companies in Portugal, the financial institutions and the Portuguese State.

Judicially authorized intercepts in the investigation of a corruption case involving other Ministries in Portugal (Portucale case) led the Portuguese Public Prosecutor in 2006 to open an enquiry on the purchase of the submarines: intercepted phone calls between top members of Mr. Paulo Portas party (CDS-PP) suggested that the party had received 1 million Euros from commissions paid by ESCOM, a financial consultant linked to GES (Espírito Santo Group).

This is the most expensive military procurement contract that the Portuguese State has ever entered into.  If the 2006 Law of Military Programming is to be adhered to, the purchase of the submarines will take up around 40% of the whole budget Portugal planned to dedicate for acquiring military equipment until 2023.
The current economic crisis only magnifies exponentially the amount Portugal will forego for more than a decade to pay for a very corrupt deal.

www.anagomes.eu/.../476e3524-ecbf-41d2-a7ce-15e5175c9f17.doc


South Africa

What different about the South African submarine deal?

On face value, the deals are about the same.

Except that the South Africa deal preceded the others.

And in the South Africa case the bribees approached the briber Ferrostaal to come up with the deal.

Once having "perfected" it, Ferrostaal did much the same again in Portugal and Greece.

But neither Portugal nor Greece have Abalone, nor  Patagonian Toothfish, nor Orange Roughy to protect, so Helmoed Heitman won't be able to justify those Ferrostaal sales on this account.

So why is it only in the Portuguese and Greek cases that Germany is getting a conviction of Ferrostaal for corruption?

It's because in the South African case the request for the deal started with Nelson Mandela and Helmut Kohl - that's why.

Both used the funds flowing from taxpayers via Ferrostaal to fund their political parties in their respective countries. Mandela made Mbeki his chief runner and Mbeki stage-managed the SDPs all the way from sperm to bank using Alec Erwin, Joe Modise and Chippy Shaik.

This is why in all the plea bargains, whether in Germany or in the UK, the South African deals just do not feature.

They are far too sensitive.

Nothing or little will come out of the South African Arms Deal investigation until Nelson Mandela has rebonded with Joe Modise.