The money is scattered in bank accounts in Singapore, about 9,600 miles away from Washington, D.C., and has been linked to bribery in Bangladesh.

But the U.S. Department of Justice last week filed a civil complaint in the District of Columbia seeking forfeiture of about $3 million held in the accounts, saying the funds are connected to a series of transactions traceable to unlawful activities including bribery of a foreign public official, extortion and money laundering.

The complaint, filed in U.S. District Court on January 8, states that the funds are subject to forfeiture in the U.S. because they were involved in "specified unlawful activities" that include violations of the Foreign Corrupt Practices Act (FCPA) - adding that the money was illegally transported through the U.S. "and/or laundered through financial institutions in the United States." It mainly relates to alleged bribes paid to Arafat "Koko" Rahman, the son of the former Bangladeshi Prime Minister Khaleda Zia, in connection with public works projects awarded to Siemens AG and China Harbour Engineering Company. "As the Prime Minister's Son, Koko in most cases was paid "protection money" to ensure that he did not use his influence to obstruct the award process," the complaint reads.

Last Thursday's action came just weeks after Siemens AG and three of its subsidiaries pleaded guilty to violations and charges related to the FCPA and agreed to pay penalties totaling $1.6 billion. That case detailed Siemens widespread practice of paying bribes to foreign government officials, and specifically mentioned about $5.3 million in bribes to politically-exposed persons in Bangladesh connected to a contract with the Bangladesh Telegraph & Telephone Board (now Bangladesh Telecommunications Company Ltd.) for mobile telephone services. "The payments were made to three business consultants pursuant to sham agreements calling for services associated with the mobile telephone project," the Dec. 12 civil complaint reads.

Revelations of widespread bribery at Siemens have helped to trigger international outrage against graft, said Alexandra Wrage, the president of TRACE International, Inc., an international nonprofit that works with companies to raise their anti-bribery compliance standards. Wrage, who is also the author of Bribery and Extortion: Undermining Business, Governments and Security, said that the "Siemens case was so systemic, so egregious, and so widespread" that it's helped mobilize citizens seeking transparency and demanding redress from corrupt public officials.

 

[UPDATE: After the article was published, we heard back from Siemens Corporate Communications and Government Affairs Compliance Communications office. "This case has no bearing on Siemens and all Siemens' potential liabilities are covered by the settlement," Siemens' Jörn Roggenbuck said in an email.]

Wrage added that she hopes anti-bribery efforts will broaden under the Obama Administration, addressing not only the businesses that supply illicit payments but also the politically-exposed persons who demand them. "Asset forfeiture is really going after the demand side," she said. "If the people who are stealing from their citizens can't spend the money- shop in London, send their children to schools in the U.S. - the way kleptocrats often do...then the interest in stealing is going to diminish."

Of course, the Siemens bribery scandal comes after years of increased attention to international corruption. The United Nations Convention Against Corruption, which came into force in December 2005, includes clear language about the seriousness and scope of graft. The preamble notes that "corruption is no longer a local matter but a transnational phenomenon that affects all societies and economies, making international cooperation to prevent and control it essential."

The document specifically mentions international cooperation in anti-corruption efforts, including asset recovery, as well as protection of sovereignty. And in 2007, the United Nations and World Bank launched the Stolen Asset Recovery Initiative (StAR) aimed at combating corruption while assisting in and monitoring the recovery of assets.

The $3 million sought in the recent forfeiture action mainly involves two local "business consultants" named Zulfikar Ali and Fazel Selim, who were used to launder money and pay bribes to politically-exposed persons (primarily Koko) in order to win building contracts for a mooring container terminal in Bangladesh, known as the "Chittagong Port Project," the complaint reads. It states that the illicit funds flowed through U.S. financial institutions before ending up in bank accounts in Singapore belonging to Ali, Selim, and the Zasz Trading and Consulting Pte Ltd.

The forfeiture complaint was submitted by Richard Weber, chief of the Asset Forfeiture and Money Laundering Section, and Linda M. Samuel, the section's deputy chief.