An internal investigation into an alleged misappropriation of funds at Diageo India is widening, with the axing of five more senior officials, couple of weeks back. In March this year, Asif Adil, then Diageo India?s managing director, left along with a few other directors after the parent firm wanted to restructure the Indian operations in the wake of its talks with the UB group to acquire a majority stake in the latter?s spirits business. It is learnt that another five more mid-level employees have been asked to leave from the company.
The officials who have been shown the door, belong to accounts, trade marketing, and brand divisions. The allegations raised against them are mismanagement of funds, and over-expenses for brand promotions, which allegedly caused the company a huge loss, a person familiar with the development said.
Responding to queries in this regard from FE, a Diageo spokesperson said, ?Diageo does not comment on confidential personnel movements in the normal course of business.?
About nine officials from UK-based Diageo Plc, including a retired Scotland Yard official, have been conducting an inquiry into these issues. It is learnt that the laptops of the staff are under the custody for examining the sales documents.
A company official said the merger of the reserve brands division with the main division, following the recession, also caused an exodus from the company. During the economic boom, Diageo India had formed a division for reserve and luxury brands, which had been merged with the main division due to lower sales during the recession period.
The exit of Ray Martin, who headed Diageo India?s duty free operations, also seems to be the cause of exodus. ?His exit and the thinning demand for luxury brands may have forced the staff working directly under him to quit the company,? the official said. However, a Mumbai-based all-India distributor of Diageo, claimed that the recent developments in the company did not affect the sales. ?We could not find out any noted decline in its sales,? he said.
Diageo sells its luxury brands such as Johnnie Walker Blue Label-King George V, JW Blue Label Magnums and single malts such as Lagavulin, Singleton of Glen Ord and Tanquery No Ten, a premium gin in India.
