ISLAMABAD ( MEDIA REPORT )
Telenor Group has responded to questions from the media in recent days regarding cases uncovered by the Group Internal Audit that are currently being handled internally or under investigation by foreign governments. The cases concern Dtac site leases in Thailand, Grameen phone sponsor ships in Bangladesh, and potential financial crimes in an unspecified country.
Telenor said Dtac has changed the way it signs mobile base station site lease contracts in Thailand, after an internal audit had discovered deviations. A PwC review commissioned earlier this year found that some partners could not provide sufficient proof that they owned the land where the base stations were located. The rental agreements were in line with common industrial practice in Thailand, but not with Telenor’s internal guidelines.
Dtac has now changed its rental agreement routines and begun a process to ensure that ownership is clearly documented in all rental agreements. This work will be concluded in 2017.
Turning to Bangladesh, Telenor said the Group Internal Audit in May 2016 found that eleven of 250 sponsorship agreements by Grameenphone broke with internal guidelines. These included sports tournaments, the security police’s jubilee celebrations, the refurbishment of their canteen and financial support for a phone book publication for the police.
Telenor said corrective and preventive measures have now been initiated, but unacceptable sponsorships uncovered in 2013 should have been followed up more closely. The most serious breach then was the sponsorship of a sports tournament related to the Bangladeshi military. Grameenphone then established a committee to approve all sponsorships, but still the 2016 audit uncovered new breaches.
All agreements in Bangladesh in breach of the sponsorship policy have been terminated, said Telenor. External legal advisors have completed two independent legal reviews of case. No payment to individuals have been detected. Telenor’s board of directors has previously considered CEO Sigve Brekke’s involvement in the case and regards the matter closed. Brekke was chair of the Grameenphone board of directors in 2013.
Last of all, Telenor said the Group Internal Audit had uncovered matters related to suspicions of financial crimes, and that it had reported them to the relevant police in one of its markets, but it did not specify which country it meant. It said it has been asked by the authorities in that country not to comment any further on the case at this point.