Norwegian publishing firm Aschehoug has vowed to tighten its internal controls after its former executive director of finance was caught embezzling millions. The company revealed on Wednesday the director had already taken NOK 4.4 million (USD 700,000) since 2010, before a further NOK 1 million transaction exposed him in December.
The director admitted to the fraud and resigned immediately. His lawyer told Norwegian Broadcasting (NRK) that he plans to repay the stolen funds, but a financial crime expert said that will have little impact when the case is prosecuted. “That he’ll pay back the money does not matter regarding judgment,” said professor Petter Gottschalk. He said it’s more pertinent that the former director has admitted to the embezzlement. Financial fraud carries penalties of up to six years in jail.
Aschehoug has released a statement by Publishing Director Mads Nygaard, promising to seek external advice in reviewing its controls and procedures. “The fraud was generally carried out with engineered documentation in the form of fictitious contracts and forged signatures, as well as the director’s misuse of procurement in the company,” the statement read. “This case has shown that the company must tighten its internal controls and improve its procedures to ensure this doesn’t happen again, and that any attempted fraud is detected sooner.”