More than three years after raiding state-owned Kongsberg Gruppen, prosecutors launched their case this week against a former sales executive at the company that delivers technological services to the oil and gas, defense, maritime and space industries. The executive who was responsible for Kongsberg’s sales in Eastern Europe was indicted last year on charges of money laundering, tax evasion and misappropriation of funds amounting to more than NOK 200 million.
Charges filed after the raid in 2014 against the company itself, in which the Norwegian state owns a 50 percent stake, were dropped last August for lack of evidence. Investigators from Norway’s white collar crime unit Økokrim decided there was no reason to believe that others within Kongsberg Gruppen were involved in the alleged fraud.
‘Unreal and extremely unfair’
Shortly after they exonerated Kongsberg Gruppen, prosecutors indicted sales executive Dag Tore Sekkelsten. Newspaper Dagens Næringsliv (DN), reporting from the courtroom (Asker og Bærum tingrett) in Sandvika where the trial began Tuesday, described how he spoke publicly for the first time this week and denied the charges of money laundering and embezzlement. He has admitted partial guilt on the tax evasion charges but claims that he finds the case against him “unreal and extremely unfair.”
Sekkelsten, defending himself during opening statements on Wednesday, said he’d thought the case was over when Økokrim chose to drop the corruption charges against Kongsberg. Sekkelsten’s defense attorney, Christian Hjort, had earlier said his client claimed that agreements he made in connection with customers in Romania were on behalf of Kongsberg Defence and Aerospace and its Defence Communications unit, and made in the company’s interests.
As in other recent corruption cases in Norway, the charges against Sekkelsten involve payments made to consultants. Hjort has claimed on Sekkelsten’s behalf that all payments made were approved by the Kongsberg companies. Sekkelsten said in court that Kongsberg “then turns around and says I had acted against Kongsberg’s interests. That feels extremely unfair in this connection.”
“I repeat,” DN reported him as saying, “it feels both unreal and extremely unfair.”
Top management changes after ‘scandal’
DN reported that the more than NOK 200 million involved was, according to Økokrim, paid out to Kongsberg’s consultants or agents without them performing any real work. Sekkelsten is believed to have received shares of the money via overseas bank accounts. He denies that, claiming he can’t understand such charges: “I have debt on a house. I have an 11-year-old car. The boat is perhaps even older. I don’t have a hytte (holiday home), nothing of value and no bank accounts abroad. If I’ve enriched myself, I think I’ve gotten very little out of it.”
He characterized himself as loyal to Kongsberg, which fired him after the indictment was handed down last year. Kongsberg was already undergoing top management and board changes, after admissions were made that neither former CEO Walter Qvam, who chose to retire at age 63 in June 2016, nor Board Chairman Finn Jebsen had forwarded results of their own internal probe on suspicions of corruption before the police started their own investigation.
Their failure to act set off protests from members of the Norwegian Parliament’s business committee, who called the failure to pass on corruption suspicions “a scandal” and also called for Jensen’s resignation. Jensen did not stand for re-election to Kongsberg’s board last spring and his post has since been taken over by Eivind Reiten, a former government minister and CEO at one of Norway’s other large state-owned industrial firms, Norsk Hydro.
‘Clear indications of corruption’ at Kongsberg
Sekkelsten claims Kongsberg did not emphasize compliance and anti-corruption efforts at the company until around 2006-2007. Even when they received more attention, he claims Kongsberg had no guidelines to help its sales force. He also claims that all the payments to consultants and agents were made from company headquarters in Norway. “I had nothing to do the payments,” he testified.
DN reported that the case involves secret bank accounts with code names, a Romanian general and Romania’s intelligence agency, and prosecutor Anna Haugmoen Mo grilled Sekkeslten about one of the secret accounts in Switzerland. He refused to answer questions about it.
Haugmoen Mo suggested in court on Tuesday that the case involves “clear indications” of corruption in the form of bribes. In order to convict anyone at Kongsberg about that, prosecutors must prove that the money landed with someone who approved the large contracts Kongsberg had in Romania. Økokrim hasn’t managed to track where all the money ended up.
Kongsberg officials did not want to comment on Haugmoen Mo’s remarks about indications of corruption. “It is not correct of us to comment on the embezzlement case against a former employee,” Ronny Lie, communications director for Kongsberg Gruppen, told DN, “but we will emphasize that there is no evidence of corruption and that the case against Kongsberg was dropped a year ago after two-and-a-half years of comprehensive investigation.” DN reported that charges against the Romanians were also dropped since foreign citizens can’t be convicted in Norway for corruption carried out abroad.