(Reuters) - A former compliance officer for Siemens AG in China sued the company on Tuesday, accusing it of firing him after he tried to expose a kickback scheme involving medical equipment sales to hospitals there.
The allegations come after Siemens resolved charges in 2008 that it paid bribes in exchange for business around the world. The lawsuit accuses the company of violating the terms of that settlement.
Meng-Lin Liu said he had uncovered “incontrovertible evidence” after he joined the company in 2008 that Siemens was engaged in a bribery scheme and submitting inflated bids on medical diagnostic and scanning equipment sales to public hospitals in China.
The company then sold the equipment at much lower prices to intermediaries picked by the hospital’s procurement officials, Liu said in a lawsuit filed in U.S. federal court in Manhattan.
Such a scheme could violate the U.S. Foreign Corrupt Practices Act, which bars U.S.-listed firms from paying bribes to officials of foreign governments, including officials at state-owned hospitals.
After he provided evidence of this scheme to managers, Liu said, he was removed from his position, told not to report to work and later fired.
Liu, listed as a resident of Taiwan in the lawsuit, is seeking damages related to lost pay and litigation costs. The amounts are not specified but he asks for twice his back pay and damages to be determined at the trial.
Siemens agreed to pay $1.6 billion in 2008 to resolve U.S. and German charges that it violated foreign anti-bribery laws through its business in countries that ranged from Argentina and Venezuela to Bangladesh.
As part of that settlement, the company also agreed to implement and maintain a robust program to comply with the FCPA and retain an independent consultant to monitor that program and report on its development to the U.S. Justice Department.
Liu said the evidence he uncovered showed that the company intentionally evaded the due diligence policies put in place to comply with its 2008 plea agreement.
The lawsuit also includes allegations involving the company’s sales in North Korea. Liu brought his suit under the 2010 Dodd-Frank Wall Street reform law, which created incentives and protections for whistleblowers who report securities law violations.
Siemens representatives did not immediately respond to an emailed request for comment.
The case is Meng-Lin Liu v. Siemens A.G., U.S. District Court, Southern District of New York, No. 13-0317.
Reporting By Aruna Viswanatha in Washington and Nate Raymond in New York; Editing by Gary Hill