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Foxconn launches internal bribery probe

Taiwan-based contract manufacturer Foxconn Technology Group has disclosed it is investigating allegations of bribery within its supply chain.
Foxconn is perhaps best known as the maker of Apple’s iPhone. Its client list also includes Panasonic, Nokia, Samsung, and Sony.
In a statement to the media, Foxconn said Chinese law enforcement officials were assisting the company’s internal audit team in assessing the validity of allegations “against a number of Foxconn employees related to illegal payments from supply chain partners.”

The statement was in apparent response to a report in Taiwan’s Next Magazine that Teng Chih-hsien, a manager with Foxconn’s surface-mount technology department, was detained in Shenzhen for soliciting bribes from suppliers.

Next also reported more than a dozen Foxconn procurement executives fled back to Taiwan after Teng’s arrest.
Foxconn was hit with additional worries last week when a strike at a factory in Fangcheng (Henan Province) grew into a full-scale street protest that may have involved more than one thousand workers.
In September 2012, a Foxconn factory in northern China was forced to close for a full day due to a riot reportedly sparked when a guard struck a worker.

Sources: The Liberty Times (自由時報), New York Times, Agencies


Benjamin Kessler is a contributing editor of the FCPA Blog and managing editor of ethiXbase. A version of this post appeared in the China Compliance Digest.

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