Ex-Reebok India MD, COO ‘fudged’ accounts: SFIO
The investigation arm of the ministry of corporate affairs (MCA), the Serious Fraud Investigation Office (SFIO), has found that Reebok India’s sacked managing director Subhinder Singh Prem and former chief operating officer (COO) Vishnu Bhagat had “fudged and fabricated” accounts of the company.
The misappropriation is likely to have an impact of over Rs 800 crore on the company’s finances. The findings essentially substantiate the probe by the economic cell of the Gurgaon Police, which arrested the two last week.
“As per the probe so far, the total impact of fudging of books on the company finances will be over Rs 800 crore... the MD and COO indulged in fraud for personal gains and to impress the board of directors regarding their performance. By inflating books of accounts and over invoicing, they have also cheated financial institutions,” sources from the investigating agency told The Indian Express.
In May, Reebok India had lodged an FIR against the two employees for allegedly orchestrating a scam to the tune of Rs 870 crore.
Global chief of Adidas — that had acquired Reebok in 2005 — Herbert Hainer, had also said that “commercial irregularities” at its Reebok unit in India had wiped out euro 125 million (about Rs 870 crore) from its global profits. On May 29, the MCA asked the SFIO to probe the allegation.
According to the findings, the two over-reported the bills receivables to the tune of over Rs 400 crore. Of this, goods worth Rs 150 crore, meant for sale, were
