IBM execs, S. Korea officials accused of bribery

Some 48 South Korean government officials and corporate executives, mainly from IBM ventures, have been charged with bribery in a case involving state contracts for computer parts and servers, prosecutors said Monday.

Fourteen government officials were bribed a total of $240,000 (290 million won) and an IBM Korea executive received golf memberships worth $82,000 from a subcontractor, prosecutors said. IBM Korea, a unit of IBM, said it did not condone the activities and that it had fired some staff involved in the case. South Korean President Roh Moo-hyun has pledged to clamp down on corruption and shady business practices, with prosecutors spearheading a series of probes to cut collusion between politicians, bureaucrats and businessmen.

The indictments followed an investigation into allegations that executives of IBM's wholly owned IBM Korea and LGIBMPC--a joint venture 51 percent owned by IBM and 49 percent owned by LG Electronics--had bribed government officials to get deals. The Seoul District Prosecutor's Office said in a faxed statement that IBM Korea had won orders for servers and PC parts worth $42.7 million and LGIBMPC had won orders worth $730,000 through illegal actions.

"IBM Korea and LGIBMPC Corp. had bribed computer-related department officials at state-run corporations and colluded with them in auctions to supply servers and PC parts," the prosecutor's office said in the statement. IBM Korea said in a statement that the action of some employees violated the company's strict code of business conduct. "Such activity was neither approved nor condoned by IBM Korea," the company said. "IBM Korea has taken action against these individuals, including termination of employment."

News source: C|net

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