Europe, Headlines

CORRUPTION: German Stink Spreads to Greece

Apostolis Fotiadis

ATHENS, Jul 7 2008 (IPS) - The scandals around dealings by the German engineering giant Siemens have revealed a long chain of corruption plaguing Greek political life.

An investigation launched by German prosecution Nov. 15, 2006 at the Siemens headquarters in Munich uncovered a system where senior members of the company maintained hidden accounts and dummy companies to hand out bribes to win contracts.

It is estimated that since the early 1990s more than a billion euros have been paid to people in European countries, the United States and China.

The investigation and the interrogation of top Siemens officials also produced evidence that money was sent to Greece for the “cultivation of a political climate”, according to the testimony of Reinhart Siekackek, the Siemens official accused of handling irregular payments, now facing trial in Munich.

Siekackek has disclosed how the bribes were distributed through dummy maritime and stock holding companies set up in Austria, Switzerland and the Middle East.

He has said that Siemens bribed both the big political parties in Greece, the ruling New Democracy (ND) and the opposition Panhellenic Socialist Movement (PASOK). The two parties have dominated the country’s political life since the beginning of the 1980s.

Siekackek has named Michalis Christoforakos, former managing director of the subsidiary company Siemens Hellas as the key conduit. Christoforakos has refused cooperation with Greek judicial authorities.

The first sign of a connection between high-ranking politicians and Siemens’s political money came when an unnamed Siemens official was quoted as telling the Greek Kathimerini newspaper Jun. 18 that “a lot of money was sent to politicians during 1997” in connection with a contract between Greek public telecommunication provider OTE and a U.S.-led consortium. Siemens was a part of that consortium.

PASOK transport minister Tasos Madelis persuaded leading members of the opposition party in September 1997 that the contract was a good one. He signed the contract Dec. 23, 1997.

The source that spoke to Kathimerini newspaper was quoted as indicating the presence of a document produced by a senior official of Siemens Hellas Jan. 19, 1998 which links the contract with bribes of over 50 million Deutschmarks. Of this money 10 million marks were paid into a bank account in Geneva used by an intermediary connected with Madelis.

The ex-minister has denied all such allegations.

But senior PASOK leader Theodoros Tsoukatos, a close associate of former prime minister Kostas Simitis, admitted in public he received one million euros on Feb. 4, 1999 through an intermediary’s account in ABN-AMRO Bank in Rotterdam. Tsoukatos claims he forwarded this money to PASOK.

The payment has been linked in Greek media with a decision taken six days later by the Defence and Foreign Policy Council to grant a contract for ‘Patriot’ missiles to a consortium of companies, including Siemens.

In another case Minister for Culture Mihalis Liapis joined a trip organised by Siemens to watch the football games at the 2005 Confederation Cup in Germany. Liapis, who was minister for transport at the time, claimed he was on a personal trip and that his presence at the same places with the rest of the group was coincidental.

Liapis published documents to show he covered his own expenses, but these also prove he followed the group itinerary. All opposition parties have called for his resignation, but the government has supported him.

It is widely accepted by the public that the Greek dimension of the Siemens scandal is unfolding mostly because of the initiative of Greek media, who have been uncovering evidence of bribery.

At the beginning of June Justice Minister Sotiris Hatzigakis dismissed publicly the possibility of politicians accepting money from Siemens, but he retracted his statement under the weight of relentless disclosures.

But Greek authorities are still not pursuing the case, commentators say. “Even after the investigation in Germany brought up the Greek branch of this scandal, local justice appeared unwilling to use the evidence,” political analyst Stavros Ligeros wrote in Kathimerini.

“It is very understandable that PASOK and ND would like to restrict the issue,” Panayiotis Lafazanis, MP from the leftist alliance SYRIZA told IPS. “It is because evidence arrives from abroad and from inside Siemens, and it is disclosed by the media that they have to put up with investigations.”

Information has been disclosed to Greek media by key Siemens officials and by the U.S.-based legal firm Debevoise & Plimpton, which carried out an internal investigation ordered by the German judiciary into the Siemens parent company.

“Whether this time real change can come about depends on how deep the light will reach, but beware of interest enclaves who will do anything to defend themselves,” Lafazanis said.

Prosecutor Panagiotis Athanasiou has decided to wrap up the initial investigation, which lasted 18 months, without reaching a formal conclusion on the involvement of political figures in corruption cases.

This means that further investigation will take place after the summer, because of delays imposed by technicalities and the August break, and no real results will be available before 2009.