U.S. technology firm Cisco Systems is suspected of paying kickbacks to top managers of Russian companies for years, BuzzFeed news website reported, quoting two former Cisco employees.
The firm is currently facing a federal investigation in the U.S. for possible bribery violations on a massive scale in Russia. At the heart of the probe are allegations that for a number of years through 2011 Cisco, after selling billions of dollars worth of routers, communications equipment, and networks to Russian companies and government entities, sent what may have amounted to tens of millions of dollars to offshore accounts.
One former Cisco employee said that in the company's Russian operations, funds for kickbacks were built into large discounts Cisco gave to certain well-connected middleman distributors. The size of the discounts was usually 35 to 40 percent, but sometimes as high as 68 percent off the list price.
Parts of the discounts were structured as rebates. Cisco sent money back to the middlemen close to Russian companies or government agencies after a sale, which would then be stowed in bank accounts in offshore havens.
The former Cisco employees said the rebates were actually kickbacks meant to "materially stimulate" officials working for the government entities.
In June 2010, Dmitry Medvedev, then Russia's president, paid a visit to Cisco's headquarters in San Jose, California, in the course of which Cisco chairman and CEO John Chambers pledged to invest $1 billion over several years in the development of entrepreneurship and sustainable innovation in Russia, including $100 million in the building of the Skolkovo innovation center, a technology innovation hub that was a pet project of Medvedev.
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.
