On Monday, July 7, the fiscal and economic crime unit of the public prosecutor's office in Amsterdam conducted raids of Dutch food giant Ahold and local offices of Big Four accounting firm Deloitte & Touche. The raids were performed in connection with a criminal investigation relating to Ahold's consolidation of a Scandinavian joint venture.
Authorities conducting the raids seized several boxes of documents at both locations. Representatives from Deloitte & Touche had been given advance notice of the raid.
The Dutch prosecutor's office announced on Monday that the criminal investigation centered around alleged falsification of documents by Ahold and incorrect information that allegedly was published in the company's financial statements.
"The suspicions [of falsification] are based on some side letters presented by Ahold concerning the consolidation of joint ventures in Sweden/Norway, Brazil, Guatamala, and Argentina," stated the Dutch prosecutor. The Dutch press has reported that Ahold did not have effective control of the companies that were consolidated.
Ahold, the world's third largest retailer after WalMart and France's Carrefour SA, has been trying to recover from an accounting scandal that led the U.S. division of the company to restate financial statements to account for profit overstatements of more than $850 million. Worldwide accounting irregularities at Ahold are now estimated at $1.1 billion.
The Securities and Exchange Commission and the Manhattan U.S. attorney's office are conducting their own investigations into whether U.S. securities laws have been violated. It is expected that U.S. charges will be brought against the company in the near future.