Results of an interim audit by PwC focusing on beleaguered Folli Follie Group show “substantially erroneous” results, something that misled investors, along with indications of embezzlement.
Specifically, the report said the inaccurate results covered several fiscal years, with shareholders and the company’s managers profiting off high share prices and trading.
Between 2001 and 2015, for instance, dividends and returned capital doled out to shareholders, based on the “cooked books”, totaled 116 million euros. The FF Group arose in 2010 with the merger of FF, the Hellenic Duty Free Shops operating in airports and Elmec
Founder and primary shareholder Dimitris Koutsolioutsos received 44 million euros on top of 130 million euros from selling off shares. His son and successor at the helm of the apparel and jewelry exporter and retailer collected 3.8 and 2.2 million euros, respectively, during the same period.
Both men have been relieved of positions within the company, which is now overseen by a court-appointed management.
The report also calls for further investigation into bourse transactions of FF group’s share via accounts of third parties.
The PwC doesn’t mince its words, stressing that between 2007 and 2017 the figures in the company’s consolidated financial statements were false and deceptive, with phony sales ascribed to subsidiaries of the group in Asia, beginning in 2001. As a result, PwC finds, the company’s share price over time recorded an upward course, allowing MM Dimitris Koutsolioutsos and Georgios Koutsolioutsos to accumulate income of 130.5 million euros and 3.8 million euros, respectively, from share sell-offs through seven private placements between 2004 and 2017.
The report also names – using italics – three former SYRIZA ministers and the chairman of the powerful standing committee of economic affairs in Parliament, as pushing through a bill that kept a portion of the company’s duty free stores outside the EU framework.
