swissfini/content/articles/seco-it-corruption-99-million-reasons.md

---
title: "SECO IT Corruption: CHF 99 Million in Contracts, CHF 1.7 Million in Bribes"
subtitle: "When a single civil servant awards contracts without bidding and nobody notices for a decade"
category: "Investigation"
date: 2021-02-18
tags: ["SECO", "Corruption", "Federal Government", "IT Procurement", "Bribery"]
---

## The Numbers

| Metric | Value |
|--------|-------|
| IT contracts awarded | CHF 99 million |
| Bribes received | CHF 1.7 million |
| Duration of scheme | ~10 years |
| Contracts awarded without public bidding | Hundreds |
| Internal controls that caught this | 0 |
| Discovered by | Investigative journalists |

## The Setup

The State Secretariat for Economic Affairs (SECO) is one of Switzerland's most important federal agencies. It handles economic policy, labor market issues, and international trade relations. Like all federal agencies, it needs IT systems.

For years, one employee was responsible for a significant portion of SECO's IT procurement. He had authority. He had relationships with contractors. He had, apparently, no meaningful oversight.

## The Scheme

The arrangement was straightforward:

1. SECO employee identifies IT needs
2. Employee awards contracts to preferred vendors—without public bidding
3. Vendors provide "benefits" to employee
4. Repeat for approximately a decade

{{< irony >}}
The "benefits" included:
- Cash payments
- Event sponsorships
- Invitations to functions
- Football match tickets
- Various other gifts

Total value: CHF 1.7 million. Average annual bribe: approximately CHF 170,000—more than most Swiss civil servant salaries.
{{< /irony >}}

## The Scale

Over the years, the employee directed hundreds of IT contracts to preferred vendors. The total value: **CHF 99 million**.

Not all of these contracts were necessarily overpriced or unnecessary. But they were awarded outside proper procurement processes. Other vendors never had a chance to compete. The federal government never knew if it was getting value for money.

## The Discovery

How was this decade-long scheme uncovered?

Not by internal audit. Not by supervisors. Not by the Federal Finance Control. Not by any of the oversight mechanisms that supposedly exist to prevent exactly this kind of corruption.

**Investigative journalists at Tages-Anzeiger and Der Bund broke the story in 2014.**

Reporters did the work that institutional controls failed to do. They found the patterns. They asked the questions. They exposed the corruption.

## The Trial

The case eventually reached the Federal Criminal Court:

- The SECO employee faced charges of corruption and accepting bribes
- Three entrepreneurs faced charges of bribery and criminal mismanagement
- The trial revealed the full extent of the arrangement

{{< irony title="The Defense" >}}
Various parties offered explanations. The contracts were legitimate. The relationships were professional. The gifts were customary business courtesies.

CHF 1.7 million in customary business courtesies.
{{< /irony >}}

## The System Failure

The SECO case raises uncomfortable questions about Swiss federal IT procurement:

### No Segregation of Duties
One person could identify needs, select vendors, and award contracts. The most basic principle of financial controls—separating these functions—was apparently absent.

### No Competitive Bidding
Hundreds of contracts awarded without public tender. In a system that supposedly requires competitive bidding for significant expenditures.

### No Pattern Detection
Year after year, contracts flowed to the same vendors. Nobody noticed. Nobody asked why.

### No Whistleblowers
In a decade, nobody inside SECO raised concerns. Either nobody knew, nobody cared, or nobody dared.

## The Broader Context

SECO wasn't alone. The same period saw:

- **INSIEME** at the Federal Tax Administration (CHF 116 million, corruption charges)
- **Various other scandals** across federal agencies
- **A pattern** of IT procurement failures

The federal government's IT procurement was, by all evidence, systemically broken.

## What Changed?

After SECO, after INSIEME, after scandal after scandal, the federal government promised reforms:

- Stricter oversight
- Better segregation of duties
- More competitive bidding
- Enhanced whistleblower protections

Whether these reforms have teeth remains to be seen. New scandals continue to emerge. The structural incentives that enabled SECO—concentrated authority, inadequate oversight, a culture that doesn't question—persist in various forms.

## The Accountability Gap

The individuals involved faced prosecution. This is appropriate.

But what about the institution that allowed this to happen for a decade? What about the supervisors who didn't supervise? The auditors who didn't audit? The colleagues who didn't question?

{{< conclusion >}}
The SECO IT corruption scandal demonstrates that Swiss federal administration can harbor decade-long procurement fraud without internal detection. It took journalists—not auditors, not supervisors, not whistleblowers—to expose the scheme.

CHF 99 million in contracts. CHF 1.7 million in bribes. Zero internal controls that worked.

The individuals were eventually prosecuted. The system that created them remains largely intact. Somewhere in Bern, other procurement officers have similar authority, similar vendor relationships, and similar lack of oversight.

Will they resist temptation? Perhaps. But the SECO case proved that the system won't catch them if they don't.
{{< /conclusion >}}

<div class="sources">

### Sources

- [SWI: Swiss public sector scandal reaches court room](https://www.swissinfo.ch/eng/business/swiss-public-sector-scandal-reaches-court-room/46835944)
- [SWI: Four indicted in federal IT corruption case](https://www.swissinfo.ch/eng/politics/bribery-and-misconduct_four-indicted-in-federal-it-corruption-case/45267664)
- [Watson: Korruption beim BAFU: Die lange Liste der IT-Millionengräber des Bundes](https://www.watson.ch/schweiz/articles/651863749-korruption-beim-bafu-die-lange-liste-der-it-millionengraeber-des-bundes)

</div>