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Renaissance uncovers fraud at Topaz unit

Dubai, August 15, 2011

Oman's Renaissance Services  said it uncovered 'serious' issues at its Topaz unit, including financial misconduct and fraud, as the diversified firm posted a 77 percent plunge in its first-half net profit.

Topaz, which pulled a $500 million IPO earlier in the year, did not disclose information to the board of directors and breached the company's code of business conduct, Renaissance's Chairman Samir Fancy said in a statement published on the bourse on Monday.

The company -- one of the biggest oil services companies in the Middle East --  discovered evidence of fraud and ethical misconduct at one of the Topaz subsidiaries abroad, centred around the use of $2.9 million of cash in the business, the statement said.     

Renaissance said it was moving to quickly address the issues, the one-off impact of which could climb to as much as $30 million. The company will cut more than 100 jobs in Topaz's engineering business and expects to realise savings from the move in 2012.     

All managers of the unnamed overseas subsidiary were dismissed and Topaz' chief executive, Fazel Fazelbhoy, stepped down on May 30, he added. Fazelbhoy told Reuters in July that he had resigned as chief executive of Topaz.      

Resignations have also been accepted for the company's finance director and the chief operating officer at Topaz Engineering, the statement said. - Reuters       

Tags: oil services | shipping | Renaissance | Topaz |

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