RIYADH, Aug 25: A Saudi Arabia based company has accused a US telecommunication giant of bribing a Saudi official with cash and gifts worth $15 million in an effort to gain business from Saudi Telecommunications Co, the country’s monopoly wireless provider.
The allegations were made in a lawsuit by the National Group for Communications and Computers Ltd, a telecom company that provides internet service in Saudi Arabia. The civil suit against Lucent was filed on Aug 8 in the US District Court, New York.
National Group alleges that Lucent and a Swiss company, ACEC, paid more than $15 million in bribes between 1995 and 2002 to a former senior official of Saudi Arabia’s Ministry of Post Telephone and Telegraph. The alleged bribes included payments for medical expenses, free use of private jets, payments for stays at luxury hotels in New York and Seattle and gifts to a Seattle hospital.
The lawsuit also claims that Lucent was allowed to end a contract with National Group costing that company more than $63 million.
A separate SEC filing Lucent made on Aug 13 says the lawsuit seeks damages of up to three times the $63 million under the US racketeering laws.
Lucent denied the allegations when the lawsuit was filed. In the SEC filing, it said company officials were cooperating with the Justice Department and the SEC.
Reports by news agencies say Lucent Technologies is now being investigated by the two US federal agencies for possible violations of US bribery laws in its operations in Saudi Arabia.
However, the spokesmen for both the US federal reportedly said they could not confirm any investigation or comment on it. Lucent spokeswoman Mary Lou Ambrus was also reported to have declined to discuss any details of the case.
Lucent has had previous troubles with the SEC. Two former sales executives were notified this spring that they could face civil charges from the SEC over their role in the company’s aggressive sales and accounting conduct three years ago.
In February, Lucent reached a tentative agreement with the SEC to resolve an agency investigation that began in fall 2000, when Lucent disclosed that it had prematurely booked $679 million in revenues in the quarter ending the prior September. That was at the beginning of the telecom industry slump, when the one-time Wall Street darling’s fortunes reversed, setting off a spiral of massive layoffs, sales of parts of its business, and quarter after quarter of hefty losses.































