Singapore's Sembcorp Marine said today that its wholly-owned subsidiary Jurong Shipyard (JSPL) has filed a Notice of Arbitration against its former auditor, Ernst & Young in respect of disputed unauthorized foreign exchange transactions.
This marks the latest step in a saga that goes back to October 2007, when Sembcorp Marine announced that it had fired its
Group Finance Director, saying in a stock exchange announcement that he had "entered into various unauthorized foreign exchange transactions." In that announcement, it put the estimated unrealized loss to JSPL arising from the foreign exchange transactions, if valid, in the region of US$165 million, not including another US$83 million that JSPL paid to one of the banks before the transactions were discovered.
Today, Sembcorp Marine said that "although a full and final amicable settlement with all the banks involved in the disputed foreign exchange transactions had been achieved in 2010, JSPL believes that it has a valid claim against Ernst & Young."
July 22, 2011