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Ausdrill investigating fraudulent payments to supplier

DIVERSIFIED mining services company Ausdrill has uncovered and is investigating fraudulent payments to a supplier, it announced on Thursday. 

The company is listed on the Australian Securities Exchange but has a wholesale fixed income instrument listed on the Singapore Exchange.

The fraudulent payments were discovered through compliance with Ausdrill's policies and procedures. The company immediately undertook a preliminary internal investigation and appointed EY for a forensic review.

In the initial investigation, Ausdrill identified that an Australia-based employee "appears to have authorised and concealed payments to an unrelated invalid supplier totalling approximately A$10 million (S$9.7 million) over eight years". The employee has been dismissed and the matter reported to the police.

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"The company and its external forensic investigator will work closely with police in undertaking further investigations," said Ausdrill, adding that this will have no material impact on its reported results or FY2019 guidance.

Said Ausdrill managing director Mark Norwell: "We are announcing this matter in accordance with our approach of full transparency and our stated objectives of enhanced governance and audit."

He said that he is "satisfied that immediate action has been taken upon becoming aware of the situation", adding: "We are now completing a comprehensive review to understand how this long-term sophisticated fraud occurred and how we can further enhance Ausdrill's systems and controls."

Ausdrill said that to ensure the police investigation is not jeopardised, it cannot provide any additional information.