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State-owned firms deny bribe claims

(China Daily)
Updated: 2009-08-21 09:48

Officials from three state-owned companies are denying they were involved in an overseas bribery case in the United States with California-based Control Components Inc (CCI).

Dingzhou Power, Datang Power and China Resources Power Holdings were added to a list of six Chinese entities allegedly involved in the scandal, according to documents released Wednesday by the US Department of Justice, which contained the confession of Mario Covino, CCI's former director of worldwide factory sales.

Last month, officials at CCI pleaded guilty under the Foreign Corrupt Practices Act to a decade-long scheme involving billions of dollars in payoffs to officials and employees of both state-owned and private companies in dozens of countries in order to secure contracts. The company sells valves for use in power generation industries.

From 2003 to 2007, CCI admitted to making 236 corrupt payments to enterprises in 30 countries, resulting in net profits to the company of $46.5 million from sales related to the bribes, according to the Department of Justice.

The six other Chinese firms that allegedly accepted bribes, such as gifts and sightseeing trips, are: Jiangsu Nuclear Power Corp, Guohua Electric Power, China Petroleum Materials and Equipment Corp, PetroChina, Dongfang Electric Corporation and China National Offshore Oil Corporation.

After learning of the US Justice Department probe, China Resources Power began investigating the allegation within its subordinate enterprises, three of which had business dealings with CCI, according to a statement released by the company Wednesday.

Officials at China Resources Power said they uncovered no misconduct among its employees. However, they claimed two of its sales agents had taken commissions from CCI during bidding procedures. The agents were not directly employed by China Resources Power, company officials said.

A Datang Power spokesperson told China Daily the company is not aware of any of its employees or subsidiaries taking bribes from CCI.

In a statement released earlier this week, Guohua Electric Power officials also denied their company was involved in any bribes.

"We had no business connections - direct or indirect - with CCI, so it is impossible for us to have taken bribes from the company," the statement read.

An official from China National Offshore Corporation who spoke to Xinhua on condition of anonymity said an internal investigation found no corroboration among its employees in the payoff case.

None of the other companies implicated in the case have made statements concerning the allegations.

While prosecutors have been under increasing pressure to investigate Chinese executives and officials allegedly involved in corrupt business deals with foreign firms, it remains unclear whether any action will be taken.

China Daily was unable to reach the Supreme People's Procuratorate on Thursday for comment on the matter.

"Chinese procuratorial branches should follow the case closely and take overseas prosecutors' evidence into account, weighing it with Chinese laws," said Ren Jianming, dean of Tsinghua University's Corruption Research Center.

Companies from Brazil, India, Malaysia, Korea and the United Arab Emirates have also been implicated for taking bribes from CCI.

Wan Zhihong contributed to the story