Italian financial police have seized documents from IBM’s Milan offices as part of the probe into allegations of fraud at one of its customers, BT Italia, according to unnamed sources cited by Reuters. The investigators visited the Italian offices of nine suppliers of BT’s Italian unit, including IBM, and took boxes of documents away, said the sources, with the seizure warrants stating that some of the transactions between BT Italia and its suppliers were faked.
The company first revealed financial irregularities at BT Italia at the end of last year, subsequently stating that "the extent and complexity of inappropriate behaviour in the Italian business were far greater than previously identified" and would result in accounting adjustments totalling some GBP 540 million. Former BT Italia managers are alleged of having conspired with suppliers and customers to fake orders and to issue false credit notes in order to reduce the operator's costs.
Investigators also sought evidence that BT Italia and suppliers contrived sale-and-leaseback transactions to artificially boost sales and profit margins, said the report. BT itself has filed a criminal complaint with Italian prosecutors, accusing several former executives and other employees of its Italian unit of breaking company rules and unlawful conduct.
