Glock's Secret Path to Profits

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In his written response, Glock's Guevara said: "Manown and Jannuzzo stole over $500,000 of Glock money for themselves and then labeled it political contributions to hide their crimes. In any event, we conducted our own due diligence, which revealed that Manown's statement that Glock money was spread to employees to make political contributions is entirely false (except as to Manown and Jannuzzo). With respect to the allegation that Glock contributed $60,000 to the 2000 Presidential political campaign, the evidence shows that Manown stole this money from Glock and transferred it to Cayman Island accounts controlled by Manown and Jannuzzo."

Manown's confession in Cobb County had serious consequences for Jannuzzo. On Jan. 14, 2008, the onetime U.S. chief of Glock's U.S. operation was arrested and charged by local authorities with theft and racketeering. The indictment alleges Jannuzzo stole a semi-automatic pistol from his former place of employment and conspired with Manown to embezzle $177,000 from Gaston Glock. Jannuzzo denies the charges. He says he never stole any money. The dealings described in the indictment related to his effort to help his former colleague Manown resolve his mismanagement of Glock funds, Jannuzzo says. As for the disputed handgun, Jannuzzo maintains he volunteered to return it but no one at Glock ever took him up on the offer.

In contrast to these denials, Jannuzzo admits he reimbursed fellow Glock employees and others for making political contributions, which was illegal. He says he first discussed the practice with Gaston Glock in 1993 during a meeting in Austria. The reimbursements, Jannuzzo adds, continued for at least 10 years. Glock indicated strong interest in the donations. "He would say, 'How are we doing? What do the candidates look like? Do we need to make some contributions?'" Jannuzzo adds: "[Gaston Glock] knew 100%. I talked to him personally about it on the phone."

No one has been charged in connection with the alleged reimbursements. Some may now be beyond prosecution because the statute of limitations has expired.

Barrett is an assistant managing editor at BusinessWeek. Grow is a correspondent in BusinessWeek's Atlanta bureau. Ewing is BusinessWeek's European regional editor.

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