Voting-machines company to U.S.: We're outta here

Voting-machines company to U.S.: We're outta here
Smartmatic will sell subsidiary to stop investigation into Venezuela links

A Venezuelan company that makes electronic machines said Friday that in response to questions about ownership, it will sell its U.S. subsidiary and withdraw from a U.S. investment review process.

Smartmatic—which has offices in Florida, California, Barbados, Mexico, and Venezula—will sell Sequoia Voting Systems, a subsidiary based in Oakland, California that Smartmatic purchased in March 2005. The company has also withdrawn itself from review by the U.S. Committee on Foreign Investment in the United States (CFIUS).

The news comes after heavy scrutiny into Smartmatic’s funding. Critics worried about the possibility of Venezuelan government investment in the company. Since Venezuelan president Hugo Chavez has been highly critical of the Bush administration, the thinking goes, the government might use its influence to tamper with e-voting machines that are used in U.S. elections.

“With so much public debate over foreign ownership of firms in an area that is viewed as critical U.S. infrastructure… we feel it is in both companies’ best interest to move forward as separate entities with separate ownership,” Smartmatic CEO Antonio Mugica said in a release.

It’s not the first time foreign-owned tech companies struck fear in U.S. government entities. Early last year, a Congressional committee worried computers purchased by federal bureaus from the Chinese company Lenovo could be used by the Chinese government to spy on the U.S. (see Lenovo, Chinese Lash Out).

Experts in such fields as technology, business, and voting say these kinds of concerns gloss over bigger issues, like voting fraud or the economics of international trade.

“I think we should be worrying about producing voting machines that don’t require trust in the manufacturer, rather than digging up the backgrounds of all the voting machine manufacturers,” Avi Rubin, professor of computer science at Johns Hopkins University and a well-known voting technology authority, said just before last fall’s U.S. elections (see Voting Booth’s Non-Tech Stink).

“China and the United States have been becoming more and more mutually dependent on each other,” iSuppli analyst Jeffrey Wu said in addressing the Lenovo worries (see 82% of Laptops Made In China). “For example, U.S. computer companies rely on cheap Chinese labor to drive costs down, which in turn keeps consumers happy with low prices.”

Like Lenovo execs, Smartmatic too denied government involvement into its affairs.

“No foreign government or entity has ever held an ownership stake in Smartmatic Corporation or Sequoia Voting Systems,” the company said in a release, calling such allegations “baseless rumours.”

Whoever buys Sequoia need not fear the company might suffer a tainted image. Despite extremely vocal worries, the U.S. Election Assistance Commission has not raised issues concerning Sequoia machines, the company said.