ST Involved in Swiss Probe

By Colleen Taylor -- 12/1/2006

A Swiss prosecutor is conducting a criminal investigation of alleged fraudulent activities engaged in by a former treasurer of STMicroelectronics N.V.

In a statement Thursday, ST said that the investigation follows a criminal complaint filed by the company in September with the authorities in Lugano, Switzerland, after findings of an internal audit. Piero Mosconi, ST's former treasurer who retired in 2005, allegedly participated in fraudulent activities in currency transactions entered into between 1998 and 2005. ST said it is fully cooperating with the prosecutor in connection with the investigation.

Additionally, ST confirmed that the transactions under investigation were discontinued at the end of 2005, and that they do not have a material impact on the company or on its previously published financial statements.

"With the implementation of organizational changes in its treasury department, and of measures designed to enhance its internal controls in the treasury activity, ST believes it has taken the necessary measures to prevent similar actions from arising in the future," the company said in a statement.

Naturally, the company seems intent on protecting itself from involvement in other negative headlines. In another announcement this week, ST said its board has given the green light to an option agreement that would pass along its shares to an independent foundation, Stichting Continuiteit ST, in the event of a hostile takeover attempt.

© 2009, Reed Business Information, a division of Reed Elsevier Inc. All Rights Reserved.