O2 is under investigation by the Serious Fraud Office over allegations of bribery, increasing speculation in some quarters that further probes could be possible.
The Sunday Telegraph, which first reported the story, says there had long been rumours of such activity, with sources adding that the industry was like the “wild west” during periods of sustained growth.
The newspaper said the O2 inquiry followed management shakeup at the operator in 2017 and the shift away from third party retail towards direct sales channels.
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O2 investigation
As part of this shift, O2 established a handset licensing arm which necessitated additional scrutiny from the Financial Conduct Authority (FCA).
The operator has since merged with Virgin Media and acknowledged the investigation in a recent financial statement that was required by the transaction.
“O2 has been addressing a request for disclosure made by governmental authorities which is related to possible violations of anti-bribery laws and regulations,” it said. “O2 continues to co-operate with the governmental authorities investigating this matter which is still ongoing.”
The company told investors that should the allegations be proven, that it had prepared for any financial penalties or other costs: “Whilst it is not possible at this time to predict the full scope or duration of this matter or its eventual outcome, O2 was able to make a reasonable estimate of the outcome, and recorded an accrual during 2019, which is included in our statement of financial position as of 30 June 2021.”
However, it said it would not provide further details of the investment because it didn’t want to prejudice the outcome of proceedings.
Virgin Media O2 has been approached for comment.
Via The Telegraph
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