NEC Corp. announced Thursday that it will give back the money it overcharged the Defense Agency and the National Space Development Agency of Japan for defense and space-related equipment over several years.
NEC President Hisashi Kaneko told a news conference that the firm will refund the money as quickly as possible once they determine exactly how much they overcharged the agencies.
To make the recalculation process transparent, the firm will set up a third-party body including a public accountant and lawyers, and also invite Defense Agency and NASDA officials to be involved, Kaneko said.
To prevent the recurrence of such a scandal, NEC will consolidate its auditor functions under a new office to come under direct supervision of the president, he said. The new office will be launched as early as spring.
Overcharging by NEC in its transactions with the Defense Agency surfaced amid prosecutors’ probes into the breach-of-trust cases involving subsidiaries Toyo Communications Equipment Co. and Nico Electronics Co.
NEC is suspected of having overcharged the agency by billions of yen on sales of equipment over the past several years. The company has admitted to the agency that it padded its bills, although it has not disclosed by how much.
An in-house probe by NASDA has also revealed that NEC overcharged the space agency by at least 2.3 billion yen over the past five years.
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