ABB launches investigation after misappropriation of funds

22-Feb-2017 - Last updated on 22-Feb-2017 at 13:30 GMT

ABB makes robots for the snack industry, among others. Pic: ABB

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ABB has launched an investigation after its former treasurer allegedly stole money from its South Korean subsidiary.

The suspected individual went missing on February 7, 2017 and ABB is working with the local police and Interpol to solve what it claims is a sophisticated criminal scheme related to a significant embezzlement and misappropriation of funds.

Forging documents

In a statement, the company said: “The treasurer of the South Korean subsidiary is suspected of forging documentation and colluding with third parties to steal from the company.

“The company immediately launched a full investigation in South Korea engaging independent forensic and legal specialists and collaborating with law enforcement authorities. This embezzlement and misappropriation of funds will have an impact on the previously reported unaudited 2016 results.

“Current estimate is a pre-tax charge of approx. $100 million. ABB has initiated mitigating actions to reduce the impact of this criminal activity on its results significantly including recovery of misappropriated funds, legal claims and insurances.”

2016 Annual Report

Antonio Ligi, media relations, ABB Group, told BakeryandSnacks, the company immediately initiated full-fledged cooperation with the relevant authorities on a local and global level.

“The progress of the investigation will enable us to disclose additional facts. On the financial front, we are finalizing the adjustments to the financial statements which we will review with our external auditors and we will publish our annual report.

“We do not anticipate any impact to the day to day operations. We’re committed to serving our customers, running our operations and business continuity is ensured.”

ABB has checked and reconfirmed the balances of its global bank accounts and can confirm this situation is limited to South Korea.

ABB says it has a zero-tolerance approach to unethical behavior and maintains the highest standards regarding integrity and ethical business practices.

As a consequence of the ongoing investigation, ABB will publish its 2016 Annual Report latest by March 16, 2017.