Early February, voestalpine announced internally that the figures had been embellished in a group company for over twelve years. Seven months later, all the evidence is on the table. And the steel giant from Linz is now getting serious and is filing a criminal complaint against two former members of the management of the company in question.
“That’s not who we are,” Herbert Eibensteiner, CEO of voestalpine, emphasized at the annual general meeting in Linz in early July, when he informed shareholders in a 17-minute lecture about the issue of incorrect bookings that improved profits.
“It was an isolated case,” he now told the media, revealing that investigations by a specialist accounting firm and a German law firm have been completed.
48,000 emails viewed, 45 people interviewed
The internal investigations were complex: 45 people were intensively interviewed, 48,000 emails were reviewed, thousands of lines of documents and hundreds of bookings were checked. The result: “There was an interaction between at least two people that did not meet the guidelines,” Eibensteiner explains.
Legal action initiated
And the company has now filed a criminal complaint against these two former members of the management of the affected group company in the Metal Forming Division. “The first legal steps have been taken,” says the CEO of voestalpine.
We also now have a much better overview of the damage caused by the incorrect bookings that took place over 12 years: the figures were embellished by 99.5 million euros. “There was no outflow of money,” Eibensteiner emphasizes.
Damage between two and three million euros
Voestalpine has paid too much tax during this period: 14 million euros have already been claimed by the tax authorities. However, it is assumed that you will also get a mid-single-digit million amount back. Ultimately, the damage will probably amount to between two and three million euros and consists of the costs of settlement, tax advisors and lawyers.
It is still unclear whether the board received excessive bonuses
According to voestalpine, steps are being investigated and prepared to claim this damage. It is still unclear whether the board received excessive bonuses during the period in which the incorrect bookings took place. If this were the case, they would be repaid, Eibensteiner explains.
When the case became public in early June with the publication of the 2023/24 annual report, voestalpine came under criticism, especially for its overly cautious communication about the incorrect bookings. Even the financial market supervisor had taken action and started investigating whether there had been a breach of the publication obligations.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
