ICAI starts proceedings in Rs 870-crore Reebok Scam

Chartered accountants’ apex body ICAI has started proceedings against a former Reebok India official for his alleged involvement in the Rs 870 crore scam at the sportswear maker that came to light in 2012.

The Rs 870 crore scam was allegedly committed by the company’s former managing director Shubhinder Singh Prem and former chief operating officer Vishnu Bhagat. The latter is a member of Institute of Chartered Accountants of India (ICAI).

A disciplinary committee of the institute is looking into the matter involving the company’ former CFO.

When contacted, ICAI President K. Raghu said the committee has started hearing in the matter.

“The Disciplinary Committee had held a hearing in the matter at Delhi in September, 2014, and further hearing has been adjourned to a later date,” Mr. Raghu told PTI.

Following reports about the scam, the institute took up the matter and had formed a “prima-facie opinion of guilt” against the concerned member.

Besides, the institute has received two separate complaints against the concerned auditors of Reebok India.

One case is being investigated by the Directorate in terms of the Chartered Accountants (Procedure of Investigation of Professional and Other Misconduct and Conduct of Cases) Rules, 2007.

The other matter is pending as it is sub-judice.

In March 2013, Adidas said its balance sheet for 2011 was negatively impacted by 153 million euros on account of commercial irregularities at its arm Reebok India. Adidas owns Reebok. (PTI - The Hindu)