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Vestas says fraud squad investigating ex-finance chief

by FP Staff  May 25, 2013 02:45 IST

COPENHAGEN (Reuters) - The former chief financial officer of Danish wind turbine maker Vestas Wind Systems A/S (VWS.CO) is being investigated by the country's fraud squad over two agreements he made with an Indian firm, Vestas said.

Vestas said it had contacted Denmark's State Prosecutor for Serious Economic and International Crime in December, but only made that public on Friday.

The company said it approached the prosecutor on the advice of its lawyers after external auditors examined deals Henrik Norremark made with RRB Energy Ltd and its related company RBB.

Norremark's lawyer, Morten Samuelsson, said in an email to Reuters on Friday that he welcomed the investigation "which we expect will show that there is nothing to come after."

Norremark resigned in February 2012 after Vestas, the world's second-largest wind turbine maker behind General Electric (GE.N), issued two profit warnings in three months.

Vestas said Norremark unilaterally released the Indian company from two debt agreements worth a total of 4.4 million euros and also decided to invest 14.5 million euros of Vestas' funds in a potential project in India.

"By entering into these agreements, the former CFO exceeded his powers as group executive significantly," Vestas said.

RRB Energy was not immediately available for comment.

Vestas said it had informed Norremark he would be held responsible for losses the company may suffer due to his actions.

It made a 18.9 million euro provision against possible losses last year.

Investigations made by external auditors and lawyers had found that neither Vestas' board of directors, nor Chief Executive Ditlev Engel, had been involved in, or had any knowledge of the transactions, the company added.

The fraud squad was not available for comment.

(Reporting by Mette Fraende; Editing by Helen Massy-Beresford and Erica Billingham)

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