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July 2, 2002 | 1800 IST
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Xerox says Indian unit made 'improper payments'

Xerox Corp disclosed that its Indian subsidiary made "improper payments" over the years to push sales to government customers, according to an annual report filing with the US Securities Exchange Commission.

Xerox Corp, once the king of copiers, holds a 68 per cent stake in its Indian unit Xerox Modicorp Ltd.

"In India, we learned of certain improper payments made over a period of years in connection with sales to government customers by employees of our majority-owned subsidiary in that country," said Xerox, which last week restated five years of results in another accounting scandal in Corporate America.

According to the Friday filing, Xerox stopped the payments in 2000 when it became aware of them.

"We estimate the amount of such payments in 2000, the year the activity was stopped, to be approximately $600,000 to $700,000," it said.

When contacted in New Delhi, Paul Arrowsmith, Xerox's spokesman for the Middle East, India, Euroasia, Russia and Africa, confirmed to Reuters on Tuesday that the Indian unit had been making payments for several years.

He said Xerox was in the process of notifying the Indian government and the Justice Department about the payments.

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