British anti-fraud watchdog launches Olympus probe

16th November 2011, Comments 0 comments

Britain's anti-fraud watchdog said Wednesday it had opened a probe into Japan's scandal-hit Olympus after receiving information from the camera and medical equipment maker's British former chief executive.

"We can confirm we have opened an inquiry into Olympus and are liaising with other organisations and international colleagues following information given to us by" ex-chief executive officer (CEO) Michael Woodford, a Serious Fraud Office statement said.

An SFO spokesman declined to give details of the probe.

It is known however that Olympus funnelled funds through four deals to help settle its losses, including the $2.0 billion purchase of British medical-instruments company Gyrus in 2008.

The deal saw Olympus pay $687 million -- more than one third of the purchase price -- to a little-known financial adviser based in the Cayman Islands.

The fee is usually just one percent of the total acquisition price.

In London, the SFO spokesman cautioned that it could be difficult to bring prosecutions following its probe.

"One of the issues for us will be that people involved are all based in Japan," he told AFP. "It may well be difficult for us to extradite them."

Olympus shocked corporate Japan last week when the 92 year-old company revealed it had covered up investment losses dating back to the 1990s.

The firm's shares are down around 70 percent since October 13 when it ousted Woodford.

The former CEO says he was fired after raising questions about payments made by Olympus in a series of deals. He has since blown the whistle on large fees in the deals.

© 2011 AFP

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