Romania opens corruption case into nine ministers over Microsoft licensing deal

Romania's local anti-corruption authorties are examining whether the government overpaid for resold Microsoft licences.
Written by Andrada Fiscutean, Contributor

Microsoft has inadvertently found itself in the middle of one of the largest corruption cases in Romania after authorities began an investigation into Windows licences destined for use in schools being sold on at inflated prices.

Romania's National Anti-Corruption Directorate (DNA) has launched an enquiry into the reselling of the educational licences, and Microsoft is not suspected of involvement. "At this moment, Microsoft is not involved as a company in this investigation," a spokeswoman for DNA told ZDNet.

The anti-corruption authority said that the Romanian government had bought Microsoft software licenses, intended to be used for schools, at a cost 30 to 40 percent higher than the market average" from a number of resellers. The government also purchased "other computers and software products at up to 50 percent higher compared to the products' value on the market or to similar products".

The contract covering the purchase of the software licenses was signed in 2004, and now prosecutors say they have reasons to believe that several former ministers received money to influence the closing of the deals. The anti-corruption agency suspects the nine former ministers — three from education, four from ICT, a former finance minister and an ex-government secretary — of offences that may include money laundering, abuse of office, and bribery in connection with the deal.

According to the prosecutors' statement, as the licences were part of a government contract, Microsoft offered a 47 percent discount on the software, but this deduction was diluted by the resellers. "Microsoft is cooperating fully with DNA's investigation," a Microsoft spokesperson told ZDNet.com.

DNA stated that out of the $54m the government paid for licences under the contract, $20m is thought to have ended up in the hands of state officials who helped Fujitsu Siemens manage the contract. Contacted by ZDNet, Fujitsu Siemens said: "This matter is under investigation by the relevant authorities, and therefore we are unable to comment."

The anti-corruption agency has asked the European parliament, the Romanian parliament and the president of the country to lift immunity from the nine politicians and is now waiting for their response. The politicians cannot be prosecuted without such a move.

This corruption probe may also stretch beyond Romania's borders. In March last year, the Wall Street Journal wrote that the US Justice Department and the Securities and Exchange Commission were investigating Microsoft's relationship with "certain resellers and consultants in Romania and Italy", due to allegations made by a former Microsoft official in China. "We cannot offer information regarding the territorial expansion of the inquiry," DNA's spokeswoman told ZDNet.

DNA is also looking into a separate deal, involving the creation of computer labs in schools and the purchase of hardware and software to equip them. The anti-corruption authority said politicians favoured local software company Siveco in the contract, which was worth $200m.

Siveco reiterated it wasn't involved in the Microsoft licensing deal and that it will cooperate with the authorities. "Whenever we have been asked, we have offered the authorities all the information about our participation in the project. All activities we carried out were according to the law," the company said.

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