Economic crime unit raids Funcom's office in Norway

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Chrisax
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Economic crime unit raids Funcom's office in Norway

Post by Chrisax »

Officers from Norway’s economic crime unit Økokrim were waiting at the doors when Funcom employees arrived at the company’s headquarters in Oslo on Wednesday morning. Witnesses reported police raided the offices, causing quite a stir in Oslo’s mostly residential area of Skøyen, but both Økokrim and the gaming developers remained tight-lipped on details.
...
On Wednesday afternoon Funcom confirmed it was charged with breaching disclosure requirements related to the game The Secret World from August 2011 until two months after the game’s release in July 2012. Økokrim is also investigating whether Funcom has failed its duty to keep accurate lists of those who had access to inside information over that period of time. “The company is cooperating fully with Økokrim,” said a Funcom statement.
http://www.newsinenglish.no/2014/01/29/ ... ds-funcom/
Funcom stock has even temporarily been taken off the Oslo stock market, reported Nowegian sites News in English and E24 (compiled by GamesIndustry International).

Norway's Økokrim economic crime unit apparently charged Funcom with breaching the Securities Trading Act and sent agents to remove several boxes of documents from Funcom's offices.

The allegations against Funcom are of false or misleading disclosures made to the market about the development of The Secret World between August 2011 and the game's launch in July 2012, as well as for two months after
http://www.eurogamer.net/articles/2014- ... ces-closed

Detailed information from Oslo Stock Exchange
http://www.oslobors.no/ob_eng/markedsak ... Ctx=1.1.17


So what does that mean?

This means that the Norway unit for "economic crime" ("Økokrim" = Ecocrime") investigated FC's main office and seized documents for the purpose of investigation.

Why that?

Funcom is listed on the Stock Exchange, so anyone can buy FC's shares. Such a company is supposed to release accurate and sincere information about is activity and to keep lists of people aware of critical undisclosed information about the health of the company.

The reason is to prevent someone with special knowledge from making unfair business with the company's shares, against the interest of other shareholders and the public in general. Which is called "insider trading".

Based on the statements quotes above (that we of course can't verify), it seems that FC is supposed to have failed those duties.

A known fact, though, is that former FC's CEO, Trond Aas, sold his FC shares (supposedly for 1.6 million USD) and stepped down around one month before FC had to announce that The Secret World didn't meet their sales expectations and that this announcement caused a huge drop of FC shares on the market (roughly to 1/10 of their previous value).

Aas stated Funcom's "financial position is strong" at the time of stepping down, although he remained in FC in the position of chief strategy officer.

Trond Aas was put under investigation for insider trading. It seems he declared that his position didn't allow him to know that TSW was not selling well (so selling his shares was on good faith).

FC has been currently de-listed from Oslo Stock Exchange. This means that FC shares can't be sold or bought there until this changes.


What happens in such a situation?

We do NOT know the situation really. Usually, IF facts are confirmed, companies get a huge fee and individuals are prosecuted.

This normally doesn't prevent the company from continuing its activity, ie AO, AoC, TSW, etc.


We wish the very best to all FC's devs and hard working staff and we do hope they can continue to work, in even better conditions in the future. :D
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Tealc
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Re: Economic crime unit raids Funcom's office in Norway

Post by Tealc »

Thanks for the Info Chris, hoping everthing goes well and the Games continue.
I haven't lost my Mind, it's backed up on a disk Somewhere.

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Hyde
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Re: Economic crime unit raids Funcom's office in Norway

Post by Hyde »

[waits patiently for Fuze to step in]
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