SFO Closes Investigation Into Fuji Xerox

The Serious Fraud Office has closed its investigation into Fuji Xerox New Zealand after determining it is not in the public interest to progress it further.

The investigation focused on allegations that former executives at Fuji Xerox New Zealand used inappropriate accounting mechanisms to inflate the company’s total revenue between 2011 and 2016. These revenue figures were used in reporting to its Japanese parent company.

Fuji Xerox New Zealand was ultimately required to restate its accounts by $355 million in 2017. No New Zealand investors were affected by this restatement.

In August 2022, Fuji Xerox New Zealand (now named FujiFilm Business Innovation New Zealand) settled a civil case brought against its former auditor EY and three of its former senior executives in connection with the restatement.

The matter involved a complex range of issues and a large volume of financial data. The SFO’s investigation was carried out in stages and included refining the scope of inquiry to matters within the agency’s remit. The scale of potential offending under consideration was a fraction of the original restatement figure.

“Having completed this work, we have now reached a stage where we are not satisfied that continuing this investigation is in the public interest,” says SFO Director Karen Chang.

“In making this decision we considered the high evidential standard needed for commencing criminal charges, the time and resources still required to complete the investigation, as well as the scale of potential offending that would fall within our remit.

“In assessing public interest, a key factorwas the absence of any New Zealand-based or vulnerable investors.

“As the new Director of the SFO, I am taking a fresh look at where we apply our specialist resources and where we can make the most impact in the current environment. It’s important that we focus our time and skill on the cases that matter the most to New Zealanders and their economic wellbeing.”

The decision is consistent with advice received from the SFO’s independent Prosecution Panel members, Michael Heron KC and Nick Williams.

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