Russian Authorities Accuse IBM of Planning to Defraud the State Pension Fund

December 11, 2006 ( - Russian authorities accused International Business Machines (IBM) of conspiring with employees at the Russian Pension Fund in a pension kickback scheme.

No IBM employees were arrested following Russian authorities’ raid on the IBM offices in Moscow, according to news reports.

The Russian Interior Ministry said on its Web site that IBM executives in Russia plotted with officials at the pension fund and with two other local software companies – R-Style and Lanit – to rig auctions and embezzle part of the $38 million the state had budgeted for new computers, according to Bloomberg.

“To embezzle the allotted funds, a number of high ranking [pension] officials responsible for conducting tenders for equipment purchases conspired criminally with representatives of the commercial companies,” the ministry said in a statement Thursday carried by a Russian news agency.

According to InformationWeek, the ministry will continue to investigate what it estimates to be a $4-million kickback scheme between IBM and pension fund employees.

An IBM spokesperson told InformationWeek that the company’s operations would continue uninterrupted.