Former Volkswagen Executive Gets Suspended Jail Term For Bribery

Jan. 25, 2007
Peter Hartz admits to paying Klaus Volkert to get his support for management decisions.

Former Volkswagen executive Peter Hartz was on Jan. 25 given a two-year suspended jail sentence and a hefty fine for his role in a bribery scandal involving lavish holidays and prostitutes. Hartz, the architect of extensive German labor market reforms and the former head of personnel at Europe's biggest carmaker, avoided prison under an agreement struck with the prosecution under which he gave full testimony and admitted paying bribes. He must pay a fine of around 560,000 euros (US$726,000.)

Hartz, 65, said he had made payments to Klaus Volkert, the former head of the powerful works council of VW, to secure his support for management decisions. "A man like Volkert had charisma, he (Hartz) recognized that and he bought it," Hartz's defense lawyer Egon Mueller told the court in the northern city of Brunswick. "Important decisions could not be taken without Mr. Volkert's agreement," the lawyer said.

The prosecution said the bribes Hartz paid to Volkert totaled 2.6 million euros (US$3.4 million), much of which was spent on trips to exotic locations and on call girls.

Hartz argued however that the payments were aimed at "creating an atmosphere" in which business could be done. "They were designed simply to stabilize relations between the two men," his lawyer said.

Under German law, works councils -- composed of representatives of workers and management -- have a strong decision-making role within major companies. Hartz was seeking to influence Volkert because he knew that VW workers would accept management decisions once they had been rubber-stamped by a man who played a leading role in the IG Metall union.

Judge Gerstin Dreyer said Hartz had also avoided prison because he "had not personally benefited financially" from the bribes.

Copyright Agence France-Presse, 2007

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