Siemens Chairman Anticipates ‘Considerable Penalty’ From SEC

Chairman Gerhard Cromme doesn't expect the company to be "broken up" over bribery investigation.

BERLIN (AP) - The chairman of Siemens AG, the German conglomerate plagued by bribery and corruption scandals, said in a report Friday that he anticipates fines from U.S. regulators but that its very existence is not endangered.

''We won't be broken up,'' Gerhard Cromme told the German newspaper Sueddeutsche Zeitung in an interview published on its Web site.

Cromme also said that he and the company were anticipating a ''considerable penalty'' from the U.S. Securities and Exchange Commission, which is investigating the company over a series of bribery scandals that have ensnared several former workers.

Siemens, which makes everything from cell-phone network components to trains and is Europe's biggest engineering company by sales, has been rocked by investigations over hundreds of millions of euros taken from corporate accounts and allegedly used to pay bribes to help land telecommunications deals.

In one case, a company executive was briefly detained earlier this year in an investigation into payments from Siemens to a company led by the head of Germany's AUB labor organization.

In another case, two former Siemens officials were convicted this month of bribery and assisting bribery for their involvement in multimillion-euro payments to officials at an Italian utility and Siemens was ordered to forfeit $51.1 million in profits from deals with Italy's Enel SpA.

Former board Chairman Heinrich von Pierer stepped down in April and current Chief Executive Klaus Kleinfeld said earlier this month he would not renew his contract with the company. Neither man has been the subject of any of the investigations.

Peter Loescher was tapped to replace Kleinfeld when he steps down at the end of September.

Cromme said that Siemens will continue its strategy on narrowing its focus on a few areas, without elaborating. In addition, he told Sueddeutsche that Siemens' executive board plans to propose a new organizational and leadership structure in the next six months.

More in Global