IBM executives, South Korean officials charged with bribery

Some 48 South Korean government officials and corporate executives, mainly from IBM Ventures, were charged with bribery in a case involving state contracts of computer parts and servers, prosecutors said on Monday. The indictments followed an investigation into allegations that executives at IBM Korea, a wholly-owned unit of US computer firm International Business Machines Corp, and LGIBMPC Corp, a joint venture with Korea’s LG Electronics Inc, had bribed government officials to bag the deals.

The Seoul district prosecutor’s office stated that IBM Korea had won orders for servers and personal computer (PC) parts worth 51 billion won ($42.68 million) and LGIBMPC Corp had won orders worth 870 million won through the illegal collusive action. ‘‘IBM Korea and LGIBMPC Corp had bribed computer-related department officials at state-run corporations and colluded with them in auctions to supply servers and PC parts,’’ the statement said. ‘‘Such activity was neither approved nor condoned by IBM Korea,’’ the company added. ‘‘IBM Korea has taken action against these individuals, including termination of employment.’’

Executives at LG Electronics and SK C&C, an unlisted system network firm in the SK Group, and other subsidiaries of South Korean conglomerates were also involved in the collusive activities, it added. The government would prevent these companies from participating in any state auction for servers and PC purchases for two years, the office said.