Complicit in Corruption: How German Companies Bribed Their Way to Greek Deals

By

Part 2: Millions Paid to 'Consultants'

Photo Gallery: Greasing the Wheels of Business Photos
dpa

A prime example of such transactions is the sale of 170 tanks that Krauss-Maffei Wegmann (KMW) recently delivered to Greece. In exchange, the company was to receive €1.7 billion.

Such deals normally involve paying millions for consulting services. Exactly what kind of consulting is provided and why the companies are often located in tax havens remains largely a mystery. The secret firms generally belong to Greek "intermediaries" -- industrialists working on commission. In many cases, so investigators suspect, these intermediaries then distribute the money to decision-makers.

In the case of KMW, right about the time when companies were invited to bid on the contract, a Greek tycoon established a shell corporation on the Caribbean island of Nevis in the fall of 1999. The firm then concluded two contracts: a negotiating agreement with KMW and one with a firm called Evanston Group Ltd. on the British Virgin Islands, which was supposed to receive $60 million in exchange for the "acquisition of offset options."

Top Secret

How, exactly, is a shell corporation in the Caribbean supposed to provide services in Athens? When these agreements -- which were classified as top secret due to their "political nature" -- became public, officials in Munich launched an investigation. But they have made no headway because the Virgin Islands refuse to cooperate.

In Greece the Athens chief public prosecutor and an investigative committee looked into the role that politicians played in the deal. But these investigations have also come to nothing. That's hardly surprising in a country where not a single one of the 450 most important corruption cases in recent years has been concluded before a court of law.

Both KMW and Ferrostaal explicitly deny ever having paid bribes for the respective deals.

Payment Overdue

By now the defense contractor has delivered all 170 Leopard tanks to Greece -- but Greece still owes the company €180 million on the order.

The German submarine consortium reports that payments have only trickled in since 2005. Here the Greek state currently still owes €321 million. And Siemens is still waiting on an additional €20 million from the security technology deal for the Olympic Games.

This has prompted a number of defense companies to turn to the German government. Their demand: If Germany is helping Greece, then the Greeks should at least pay their debts.

Translated from the German by Paul Cohen

Article...
  • For reasons of data protection and privacy, your IP address will only be stored if you are a registered user of Facebook and you are currently logged in to the service. For more detailed information, please click on the "i" symbol.
  • Post to other social networks

Comments
Discuss this issue with other readers!
1 total post
Show all comments
    Page 1    
1. Astonishing similarity to another recent Der Spiegel’s article
Norberto_Tyr 05/12/2010
The real question is philosophical; can pragmatist materialistic people live together with idealistic one without destroying the social fabric? The answer, without doubt, is no. How can someone be fairly tried by judges that not believe in truth? And be sure about this, pragmatists will flood the legal system clogging and filling the courts to the brim. Therefore, I would say that modern Greek’s problems are related to the migratory policies of the Turks and British protectorate. Norberto
Show all comments
    Page 1    
Keep track of the news

Stay informed with our free news services:

All news from SPIEGEL International
Twitter | RSS
All news from Europe section
RSS

© SPIEGEL ONLINE 2010
All Rights Reserved
Reproduction only allowed with the permission of SPIEGELnet GmbH



Graphic: German exports to Greece (2009) Zoom
DER SPIEGEL

Graphic: German exports to Greece (2009)



European Partners
Presseurop

Politiken

Corriere della Sera

Concordia Casts Off

Concordia Leaves Giglio


Facebook
Twitter