ZF Friedrichshafen Looking Into Business Ties With Korean Chung Eui Sung
November 08 2011 - 8:25AM
Dow Jones News
German public engineering company ZF Friedrichshafen AG is
reviewing its business ties with South Korean business man Chung
Eui Sung who is linked to an investigation into diesel engine maker
Tognum AG (TGM.XE) over compliance rule breaches.
"Just like many other companies, ZF Friedrichshafen has business
relationships with Chung Eui Sung's companies," the company said in
an email statement.
ZF Friedrichshafen has so far found no evidence of
irregularities in connection with payments to South Korean
companies, it added. A ZF spokesman declined to provide further
details.
Tognum, a subsidiary of Daimler AG (DAI.XE) and Rolls-Royce PLC
(RR.LN) has been under investigation by German public prosecutors
for the past three weeks over allegations of compliance rule
breaches and bribery. According to prosecutors, the allegations
relate to suspicious payments in the million-euro range in South
Korea for defense-related goods.
The probe led to the resignation of Togum executive board member
Peter Kneipp and the company pledged it would clarify any further
possible breaches of compliance.
In particular, prosecutors are looking into provisions paid by
Tognum's MTU Asia division to sales agents in South Korea between
2000 and March 2011 worth EUR26.7 million. Additionally,
prosecutors are looking into payments worth around EUR160,000 made
to South Korean army staff between 2000 and 2007.
Industrial giant ThyssenKrupp AG (TKA.XE) and MAN SE's (MAN.XE)
Renk division have also said they are internally investigating
business ties to Chung Eui Sung's company, UBMTECH Ltd.
-By Nico Schmidt, Dow Jones Newswires; +49 69 2972 5507;
nico.schmidt@dowjones.com
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