Pegatron Corp (和碩), a contract manufacturing arm under Asustek Computer Inc (華碩), yesterday said it has launched an internal investigation into allegations of kickbacks paid to an Apple Inc employee and that it has suspended the manager suspected of being involved.
“Pegatron was surprised to learn of the alleged conduct in media reports … Such conduct is reprehensible and in conflict with Pegatron’s principles and practices,” the company’s spokesman Charles Lin (林秋炭) said in a statement.
The company has suspended the manager, who has not been named, at its Chinese subsidiary, Kaedar Electronics Co (凱達), and the company will take all necessary and appropriate actions, Lin said.
“[The manager] believed that she was paying the money for commercial purposes and not as a kickback,” Jonathan Chang (張昭平), finance director at Pegatron, said by telephone yesterday.
The employee is the most senior manager at Kaedar, Chang said.
Pegatron acquired Kaedar in July 2008. Kaedar, established in 2001 in Kunshan, Jiangsu Province, primarily manufactures plastic packages for electronic products, including iPods.
Despite the fact that Kaedar is independently operated and managed, and the manager has not been accused of any wrongdoing, Pegatron will closely monitor the investigation, Lin said.
A US federal grand jury indicted Paul Devine, an Apple global supply manager, for allegedly taking at least US$1 million in kickbacks from six Apple suppliers in Asia. Devine, 37, pleaded not guilty on Monday to money laundering and wire fraud charges in a US court.
The indictment document released last week said Kaedar was among six Asian firms that received confidential information from Devine to help it negotiate favorable terms in supply contracts with Apple between 2005 and 2008.
The other companies accused include Cresyn Co in South Korea and Jin Li Mould Manufacturing Pte Ltd (精利製模) in Singapore.
Chang said payments were made from Kaedar to Devine’s company, CPK Engineering, from 2007. He did not say how much money was paid or how long the transactions continued.
Lin said paying commissions to agents for sales orders is common practice for Pegatron and the industry, while the company does not pay bribes or kickbacks to secure business, he added.
Pegatron’s shares appeared undeterred by its subsidiary’s scandal yesterday. The stock rose 1.6 percent to close at NT$38.8 (US$1.2) on the Taiwan Stock Exchange yesterday.
Brokerage firm Macquarie Equities Research is upbeat on Pegatron’s prospect, saying the company is emerging as a large electronics manufacturing services firm with new orders expected to come from Acer Inc (宏碁) and Apple.
About 60 percent of Apple’s products, such as iPhones, iPads and iMacs, are contract manufactured by Hon Hai Precision Industry Co (鴻海精密), and Pegatron may supply Apple’s CDMA iPhones from the first quarter next year, said analyst Daniel Chang (張博淇).
Pegatron has the potential to be a future second source for iPads or Macbooks as well, as Apple aims to cut dependence on Hon Hai, he said.
In addition to notebook orders from Asustek, Pegatron has won orders from Acer with shipments to begin within one to two quarters, Chang said.
ADDITIONAL REPORTING BY BLOOMBERG
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
Meta Platforms Inc offered US$100 million bonuses to OpenAI employees in an unsuccessful bid to poach the ChatGPT maker’s talent and strengthen its own generative artificial intelligence (AI) teams, OpenAI CEO Sam Altman has said. Facebook’s parent company — a competitor of OpenAI — also offered “giant” annual salaries exceeding US$100 million to OpenAI staffers, Altman said in an interview on the Uncapped with Jack Altman podcast released on Tuesday. “It is crazy,” Sam Altman told his brother Jack in the interview. “I’m really happy that at least so far none of our best people have decided to take them
As they zigzagged from one machine to another in the searing African sun, the workers were covered in black soot. However, the charcoal they were making is known as “green,” and backers hope it can save impoverished Chad from rampant deforestation. Chad, a vast, landlocked country of 19 million people perched at the crossroads of north and central Africa, is steadily turning to desert. It has lost more than 90 percent of its forest cover since the 1970s, hit by climate change and overexploitation of trees for household uses such as cooking, officials say. “Green charcoal” aims to protect what
RSS