BT could face criminal investigation over irregularities at Italian arm
- Credit: Archant
BT is facing a criminal investigation by prosecutors in Milan over allegations of embezzlement and false accounting in its Italian division, according to reports.
The case will be spearheaded by Fabio De Pasquale, who previously led a high-profile inquiry into former Italian prime minister Silvio Berlusconi, the Financial Times said.
It comes after nearly £8bn was sliced off BT’s share price on Tuesday when the firm booked a £530m writedown and warned that profits would take a hit from the fallout of an accounting scandal in its Italian arm.
The telecoms giant said that following an independent review of the business by KPMG, the “extent and complexity of inappropriate behaviour in the Italian business were far greater than previously identified”.
The net result is there has been an overstatement of earnings at BT’s Italian business over a number of years, leading to the upwards revision in the value of the writedown.
You may also want to watch:
The firm said it expects the affair to result in a reduction in its third-quarter adjusted revenue and adjusted earnings of around £120m.
For the financial year as a whole, BT expects adjusted revenue to decrease by around £200m and adjusted earnings by £175m. It expects to take a similar hit next year.
- 1 Dozzell set for QPR, as Championship clubs show interest in Downes
- 2 Inside quirky off-grid houseboat with stunning river views - yours for £500k
- 3 Postman who abandoned 'undriveable' van wins unfair dismissal claim
- 4 Man in 20s dies after fall from pub
- 5 GP surgery in 'special measures' after patients and staff raise concerns
- 6 Woman suffers life-threatening injuries after fall from building
- 7 Cyclist hurt in crash with car
- 8 Covid infections mapped: 20 postcode areas report three or more cases
- 9 'Spooky' bushes full of caterpillars spotted near Suffolk roads
- 10 My frustration at how rude drawings balls up our beaches
BT also warned that the outlook for UK public sector and international corporate markets has “deteriorated”.
The Italian business accounts for around 1% of BT’s earnings.
Shares in BT were up more than 1% in early afternoon trading on the London Stock Exchange.