Court orders investigation into Rs 11-billion Ricoh accounting fraud case

A district court has ordered an investigation into the alleged fraudulent transactions worth Rs 11 billion by three Ricoh India employees and two business partners of the company. The metropolitan magistrate of Saket court asked the Delhi police to file an FIR based on the order and probe the matter.

In 2016, Ricoh India, a local subsidiary of Japanese multi-national imaging and engineering solutions firm Ricoh Company, alleged that three of its local employees, along with REDHEX IT Solutions Pvt Ltd and Fourth Dimension Solutions Ltd, indulged in fraudulent accounting practices. Later, a PwC audit revealed that the malpractices, starting January 2014, resulted in losses of over Rs 11 billion for Ricoh. Following this, a Sebi probe indicated wrongdoing. It ordered six top employees of Ricoh India to stay away from dealing in the securities market and ordered a forensic audit of its finances.

The irregularities saw the parent firm infusing Rs 11.23 billion into the local arm in 2016. Ricoh informed the Japanese stock exchange that it has taken a hit of Rs 17.11 billion for its India business in the year ending March 2018. Its top executives took a 15 per cent pay cut for a quarter.