Two former Siemens officials pleaded guilty to criminal charges in U.S. District Court in Chicago yesterday, the latest defendants to admit to a scheme to falsify and circumvent minority contractor status requirements in a hospital radiation equipment purchase deal.
In January Siemens, two former employees from a Malvern, Pa-based Siemens subsidiary, a sham joint venture company Siemens contracted with and the founder of that venture were charged with mail and wire fraud. On Tuesday, Daniel Desmond, the business administrator of the Siemens office in Hoffman Estates, Ill., pleaded guilty to a single count of perjury, while Ellen Roth, the in-house counsel for the subsidiary, pleaded guilty to a single count of lying to the FBI. The county-owned public hospital requires bidders for contracts to subcontract at least 30% of work to certified minority-owned businesses.
Earlier this month the American subsidiary of Germany-based Siemens, pleaded guilty to obstructing justice and agreed to pay a $1 million fine and $1.5 million in restitution to Cook County, Ill., in connection with a $49 million contract it signed with 460-bed John H. Stroger Jr. Hospital of Cook County in 2000.
At a June 14 sentencing hearing Desmond and Roth each face up to five years in prison and $250,000 in fines, plus restitution. Assistant U.S. Attorney Barry Miller, who is prosecuting the case, said the remaining defendant, Faust Villazan, is scheduled to appear at a March 14 plea hearing.
Roth and Desmond and their attorneys declined comment after the hearing Tuesday.