updated 12:25 pm EST, Thu December 29, 2011
SEC charges former Deutsche Telekom execs
US Regulator the Securities and Exchange Commission (SEC) has charged Deutsche Telekom, a Hungarian unit and three former executives in a corruption case, according to a Thursday report. The charges include bribery of government officials in Macedonia and Montenegro dating back to 2005 and 2006, with the activities made public in 2010. Magyar Telekom, a unit of Deutsche Telekom, allegedly gave Macedonian officials 4.88 million euros (about $6.3 million) disguised as consulting and marketing contracts in order to keep a rival out of the market.
The SEC also found the same execs in 2005 paid 7.35 million euros (nearly $9.5 million) to third-party consultants in four fake contracts later to be funneled to Montenegrin officials. These funds were in exchange for helping Magyar buy Telekom Crne Gore.
The three former Magyar execs that were charged under the Foreign Corrupt Practices Act by the SEC include Chief Executive Elek Straub, and strategy executives Andras Balogh and Tamas Morvai.
The US Department of Justice may file similar charges against the companies and former executives, as it has been known to do in the past.