Shanghai Bribery Inquiry Ensnares Big Firms
By DAVID BARBOZA
SHANGHAI, Jan. 19 — The Shanghai police have detained 22 people in a bribery investigation that has ensnared some of the world’s biggest companies, including McDonalds, Whirlpool, McKinsey and ABB, according to reports in the state-run news media.
The government did not announce formal charges, disclose who was detained or offer a full list of the companies involved. But the news reports said today that the bribes in the case totaled about $500,000, and that some of the people detained were “company directors and senior employees.”
The detentions seem to be part of a broader anti-corruption drive that has been sweeping China over the past few years, toppling dozens of wealthy businessmen and high-level government officials, including Chen Liangyu, who was the Shanghai party secretary and a member of the ruling politburo until his arrest last September.
But the cases announced today did not appear to involve bribes to government officials; rather, they seemed to be about bribes or kickbacks to win business contracts, a practice believed to be widespread in China.
American and European executives have complained for years that they have to carefully supervise local employees, and occasionally battle them, because marketing deals in China so often involve kickbacks or bribes.
None of the American or European companies named in the press reports today could offer much detail on the detentions in Shanghai.
A spokesman for McKinsey & Company, the giant global business consultancy, said the company has not been accused of any crime and that it is looking into the matter.
But one McKinsey employee, who asked not to be named, acknowledged that two people in the firm’s computer procurement division were accused of accepting bribes and were detained last May.
Thomas Schmidt, a spokesman for ABB, the Swiss-Swedish builder of power generation and distribution equipment, said in a telephone interview today that he could not confirm that anyone from his company had been detained in Shanghai. He said ABB was looking into the allegations of improper conduct.
Shanghai-based officials at McDonald’s and Whirlpool could not be reached for comment on the matter Friday evening.
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I recently returned from a 3
I recently returned from a 3 week trip in Asia, part sightseeing/part future-home scouting. This article hints at why I prefer some Asian cultures to US mainstream culture.
Neither side of the fence is a utopia; there is much to be cynical about wherever you look. And, of course, xenophobia/racism do exist in the east. However, when I attempt to balance both sides of this complex equation, I find that there are a couple of critical factors missing on the Eastern side that make all the difference: white privilege, and inherent hostility towards black people. Unlike in our freedom-loving democracy, a rich white kid will get flogged in Singapore, and his corporate dad's deal is at the mercy of forces beyond his (or his network's) control.
In big and small occurances, I find that there is a sharp leveling of the field w.r.t. the familiar struggle between western black and white. Not because of any overriding sense of justice, but simply because the game is changed, and the game-pieces that once held power (i.e., caucasian-ness) are marginal on the new board. I am still deciding whether or not I like the 'rules' of this eastern game.
In big and small occurances,
I used to work at a Japanese-owned bank in NYC. Few things were more smugness-inducing than overhearing vice presidents and senior vice presidents whining things like, "I hate them. To them, were just gaijin...that's what they call us, you know..."Â