ABB loses US$100m in criminal scheme

SWISS engineering giant ABB has had US$100m stolen through a “sophisticated criminal scheme” at its South Korea subsidiary.

The treasurer of the subsidiary is suspected of forging documentation and colluding with third parties to steal from the company, ABB said in a statement. It uncovered significant financial irregularities after the suspected individual went missing on 7 February. As a result, it expects to book a US$100m charge to its previously reported 2016 results.

“The company has checked and reconfirmed the balances of its global bank accounts and can confirm that this situation is limited to South Korea,” ABB said.

The Financial Times reports that in a letter to staff, ABB CEO Ulrich Spiesshofer warned that the damage to the company’s reputation could be greater than the financial impact.

“Based on the large sums involved and the sophisticated fraud, it is almost certain that the employee in question was not acting alone; in all likelihood third parties inside or outside our company were involved,” he added.

ABB has engaged independent forensic and legal specialists as part of its investigation into the theft and is working with local police and Interpol.