Swisscom seeks quick resolution in Fastweb probe

FRANKFURT, Feb 24 (BestGrowthStock) – Swisscom AG (SCMN.VX: ) will
seek a quick resolution of allegations against its Italian unit
Fastweb SpA (FWB.MI: ) in a money-laundering probe, it said on
Wednesday, adding it was investigating the matter itself.

Italian investigators on Tuesday issued an arrest warrant
for Fastweb founder Silvio Scaglia and 55 others as part of the
probe. [ID:nLDE61M1O2]

Prosecutors allege money was laundered via fictitious
international phone service purchases and sales worth more than
2 billion euros ($2.7 billion) between 2003 and 2006, carried
out with the knowledge of top executives at Fastweb and Telecom
Italia SpA’s (TLIT.MI: ) Sparkle unit.

The companies have denied any wrongdoing.

Swisscom said it was surprised by the latest turn of events
but said it had been aware of an investigation into tax evasion
when it acquired Fastweb in 2007.

“The allegation of VAT abuse have been complemented with
allegations of money laundering, directed towards individuals
within the abusing third companies and the companies involved in
the VAT allegations”, it said.

“Between the years 2003 and 2006, Fastweb bought and sold
services (phone cards and voice services) from Italian
providers, whereby Italian VAT (value added tax) was included in
the purchase prices,” Swisscom said.

It added that according to the authorities’ allegations,
vendors entered into transactions to avoid delivering that
transferred VAT, paid by Fastweb, to tax authorities.

“As a result of this investigation, Fastweb has not yet been
fully refunded in VAT,” Swisscom said, adding that it sought two
separate opinions from tax consultants on the matter when it
acquired Fastweb.

The consultants found that the transactions in question were
correct and Fastweb was therefore entitled to a refund of the
VAT.

Fastweb said on Tuesday a judge would rule on a request for
a “temporary commissioning” at a March 2 hearing. Chief
Executive Stefano Parisi and two managers are being
investigated, it said.

Telecom Italia said Sparkle and several people, including
some managers from both the unit and the parent company, were
included in the probe.

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(Reporting by Nicola Leske; Editing by David Holmes)
($1=.7361 Euro)

Swisscom seeks quick resolution in Fastweb probe