In a statement issued this week, UK-based De La Rue said its ongoing investigation into the “serious” production problems at the mill revealed that some of its employees had “deliberately falsified” certain banknote paper specification test certificates for a “limited number of customers”.
Further to its investigation, De La Rue discovered that a small number of banknote papers had “fallen marginally short” of the specification. This resulted in the board stopping shipment of the affected banknote paper.
Nicholas Brookes, executive chairman of De La Rue, said: “The behaviour of some of our employees in this matter was totally unacceptable and contravened De La Rue’s rigorous standards. We do not tolerate such behaviour and appropriate disciplinary action is being taken.”
The damaging revelation, which sparked a 9% fall in the company’s share price, has led to a second high-profile departure, with the announcement that a new managing director, Keith Brown, has been appointed to De La Rue’s currency division.
The departure of the previous head of the currency division follows the resignation of former chief executive James Hussey, who stepped down last month after taking responsibility for the group’s paper production problems.
Meanwhile, De La Rue is being assisted in its investigation by its external legal advisers and has reported its findings to the relevant law enforcement agencies.
While the group has not been able to quantify the scale of the damage to its full-year results for the current and subsequent years, it said the adverse financial impact on first-half pre-tax profit would likely be “at least £35m”.
This has been attributed to one-off costs, including stock write-offs, professional fees, rectification and production trial costs, as well as some “slippage” of currency volumes in the second half.
In Australia, De La Rue operations have historically focused on cash-handling equipment; its Cash Systems Division was split off in a management buyout in 2008 and renamed Talaris.
The company prints banknotes for over 150 countries.
Read the original article at www.printweek.com.
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