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Last Updated: Thursday, 26 April 2007, 10:47 GMT 11:47 UK
US Siemens fraud probe formalised
Siemens headquarters
Siemens has upgraded its internal inquiry into corruption
The US finance watchdog, the Securities and Exchange Commission, has formalised its investigation into alleged bribery at German engineering group Siemens.

The scandal at the firm concerns allegations that senior managers ran a slush fund of up to 420m euros ($572m; 286m) to help win overseas contracts.

Siemens chief executive Klaus Kleinfeld said on Wednesday he will now leave the firm, despite not being implicated.

The company is also being probed by the US Department of Justice.

Number of arrests

The scandal at Siemens first broke in November last year.

Siemens chief executive Klaus Kleinfeld
Mr Kleinfeld will leave the firm in September

Since then a number of current and former senior executives in Siemens' telecoms unit have been arrested by German police.

Siemens' former chairman Heinrich von Pierer has also quit, but like Mr Kleinfeld he is not accused of having any personal involvement in the scandal.

Mr Kleinfeld will now stand down in September when his current contract expires.

Siemens, which itself said it had uncovered as much as 420m euros in suspicious payments, protests its innocence as a company.

It is now continuing with its own internal investigation into the scandal.

Siemens has warned that the ongoing investigations could lead to what it called "substantial uncertainties", but added that, to date, the scandal had not affected its bottom line.

On Wednesday it reported that its latest quarterly profits had risen 36% from a year earlier to 1.26bn euros.

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12 Feb 07 |  Business
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27 Apr 07 |  Business

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