NEC worker steals $310m for food and drink

Quakester2000

March 29, 2006

cnlson used our news submit to tell us that NEC will be
restating its financial results. The reason for the reinstatement is due to a
worker that made some $310 million fake transactions over the past three years.
The excuse the worker gave when caught was that he wanted to spend the money on
food and drink!!

In a statement NEC said
that an unnamed worker in its semiconductor division had created a series of
fictitious transactions. The scam worked by the worker creating fake purchasing
orders then put it through the accounting system and received payments from
customers. The transactions worked by billing customers for goods that were
never delivered by using round trips via various NEC's engineering subsidiaries,
vendors and purchasers. The first transactions were logged in 2002 and
were logged until December 2005.

The weird thing about
this whole scam is that customers paid on time for goods that never
arrived. NEC hasn't explained why customers would pay for fake gear that didn't
exist, but did say once management found out a full investigation was
started. The company hired outside investigators and lawyers to fix the
mess.

NEC said that it
would take any action necessary including criminal action against the
employee. Once the lawyers and accountants have sorted through the system
NEC will be restating its financial results. NEC said that tighter
financial controls would be put in place after this
incident.

NEC this week warned that it will need to restate past financial results after a worker allegedly booked some $310m in faked transactions over three years. The reason for such abuse? NEC claims the worker wanted the money for "drinking and eating".

In a lengthy statement, NEC accuses an unnamed male
employee in its semiconductor design group of creating a string of
"fictitious transactions." The worker would allegedly create a fake
purchase order, push it through NEC's accounting system and then weirdest
of all actually receive payments for the products from customers."The false transactions relate to certain sales of
products, which were actually not delivered, and were fabricated by
creating fictitious 'round-trip' transactions among NEC Engineering and
its vendors and purchasers," NEC said. "The fictitious transactions were
first recorded in March 2002 and recorded repeatedly until December
2005."

Oddly, NEC never explains why a customer would pay for
made up product. The customers, however, appeared impressed with the fake
gear with all of them paying for the equipment on time, according to NEC.NEC management caught wind of the sketchy
transactions and kicked off an internal investigation into the matter. The
company hired independent lawyers and accountants to sort through the
mess.

"Based on these findings, NEC Engineering will take any
necessary actions, including filing criminal actions, against the
employee," NEC said.NEC plans to restate its
financial results once auditors have finished looking into the matter, and
the company vowed to institute tighter financial
controls.

Source: The Register