United Nations Corruption Scandal
In 2005, subsidiary Eurest Support Services won contracts to provide food to UN peacekeepers in Liberia, valued at $237 million.
Alexander Yakovlev, the UN procurement officer, and Vladimir Kuznetsov, head of the UN Committee for Administrative and Budgetary Issues, were arrested and indicted after taking nearly $1 million in bribes from Compass.
Competitors Es-Ko and Supreme Foodservice AG initiated lawsuits claiming violation of the Racketeer Influenced and Corrupt Organizations (RICO) Act, the Sherman Antitrust Act and New York State's Donnelly Act regulating free trade. Federal investigations are underway and the case has been referred to the Serious Fraud Office (UK).
After its own three-month internal investigation, Compass declared it had discovered "serious irregularities" in its UN business, but that these were limited to "only a few individuals" who were dismissed: Peter R. Harris, Andy Seiwert and Doug Kerr. While Compass refused to make public its investigation, CEO Michael Bailey stepped down in June 2006.
Read more about this topic: Compass Group
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