Saudi suit claims Lucent OK'd bribes
Says top officials of firm oversaw 7-year scheme
TRENTON, N.J. -- A Saudi telecom company claims in a lawsuit that top current and former executives of telecommunications gear maker Lucent Technologies were directly involved in a seven-year bribery scheme to win billions of dollars worth of business from Saudi Arabia's government.
Silki-La-Silki National Telecom Ltd. sued Murray Hill, N.J.-based Lucent in August, accusing it of bribing Saudi Arabia's former telecommunications minister with cash and gifts worth $15 million to $21 million from 1995 through 2002. The suit said Lucent paid the money to gain business from Saudi Telecommunications Co., the country's monopoly wireless provider.
An amended complaint unsealed this week adds allegations of extortion and money laundering and also names specific individuals, including a former Lucent chief executive and the current CEO of Lucent spinoff Avaya Inc. of Basking Ridge, N.J.
"We allege that top Lucent executives and their Saudi business partners were engaged in an extensive conspiracy involving bribery, extortion, and money laundering," Donald Burke, an attorney representing Silki-La-Silki, said yesterday.
Silki-La-Silki, which formally did business as National Group for Communications and Computers Ltd., is seeking $225 million, triple the amount the company claims it lost because Lucent canceled subcontracts with Silki and did the work itself.
Meanwhile, the US Department of Justice and the Securities and Exchange Commission continue to investigate whether Lucent violated federal racketeering and bribery laws.
The amended complaint, filed in US District Court in Manhattan, accuses former Lucent CEO Richard McGinn and Lucent's former chief of protocol, Robert W. Frye, of approving two checks totaling $2 million to a top cancer center in Seattle that treated Ali Al-Johani, then Saudi Arabia's minister of Post Telephone and Telegraph, for leukemia. McGinn was fired by Lucent's board in October 2000.
One of the two authorization forms also was initialed, indicating approval, by James K. Brewington, whom Lucent this month appointed president of its new developing markets group. He had been president of Lucent's wireless communications business. Brewington serves on the board of directors of the US-Saudi Arabian Business Council and is a member of the United States/Egyptian Presidents' Council.
"We have still put Jim in a position of business leadership. I think that speaks for itself," said Lucent spokesman Bill Price, who declined to comment further because the litigation is pending.
The 86-page amended complaint accuses Donald K. Peterson, Lucent's former chief financial officer and now Avaya's CEO, of signing checks totaling $2.035 million that were "donated anonymously" to the cancer center on behalf of Al-Johani.
