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Last Updated: Tuesday, 19 April, 2005, 08:02 GMT 09:02 UK
ABB reports 'bribery' at US unit
ABB CEO Fred Kindle
Fred Kindle says the firm has "zero tolerance" of corruption
Swiss engineering group ABB has uncovered a case of suspected bribery at a US subsidiary.

An investigation following the dismissal of two managers in 2004 uncovered $560,000 in suspicious payments, the firm said.

ABB has reported its findings to the US Securities and Exchange Commission and the Department of Justice.

ABB has struggled with debts, asbestos liabilities and falling sales, which have left it nursing heavy losses.

The firm, once a paragon of the engineering world, is currently trying to draw a line under its asbestos problems - the legacy of another US unit - by agreeing a $232m extra payment to claimants.

It has gone through several management teams in the past three years as its debts reached more than $7bn, while its shares lost most of their value.

This year, however, they have added 15% as its recovery continues.

ABB's announcement on Tuesday is the second significant allegation of corruption at the firm in the past year.

In 2004, the manager of one of its Italian subsidiaries was fired for making "improper payments".

The new case, ABB said, revolves around payments made to intermediaries in Latin America and the Middle East "in connection with the [US] company's business, which is control software for utilities".

Chief executive Fred Kindle said the firm's decision to volunteer the information to regulators and investigators showed it had a "zero tolerance policy on compliance and business ethics".


SEE ALSO:
ABB shares fall on court verdict
03 Dec 04 |  Business
ABB loss sparks overhaul
28 Oct 03 |  Business
Investors cheer ABB's record loss
27 Feb 03 |  Business


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