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UK: Three 'face jail' over Ikea deals

BBC News Online
September 7th, 2007

A supplier and two employees of the furniture giant Ikea have admitted to using bribes in purchasing deals.

Adam Hauxwell-Smith, of Chipping Norton, Oxfordshire, pleaded guilty to 18 charges of corruption when he appeared in Birmingham Crown Court.

He paid up to 648,000 to John Brown, a buyer, and Paul Hoult, a sales leader with Ikea, to overlook store rules.

Judge Patrick Eccles warned the defendants that they were likely to be jailed for the offences.

Mr Brown, 47, of Crow Point, Halifax, West Yorkshire, and Mr Hoult, 39, of Copper Beech Close, Harborne, Birmingham, each pleaded guilty to nine charges of corruption for accepting the payments.

The court heard Mr Hauxwell-Smith, 46, began making the payments to get the men to turn a blind eye to Ikea's "40% turnover rule".

Under the rule, the store does not accept more than 40% of the turnover of any single supplier.

Joanna Korner QC, for the prosecution, said ultimately the payments led to the trading relationship between Mr Hauxwell-Smith's company and Ikea becoming "supplier-driven rather than purchaser-driven".

He would contact them with details of supplies he had in stock, and a matching order would then be placed, she said.

The payments were made between February 1999 and February 2000.

Other defendants

Two other charges against Mr Hauxwell-Smith, one of conspiracy to commit fraud and one of intimidating a witness, will be allowed to lie on file. He has denied both.

Three other defendants - Mr Hauxwell-Smith's wife Leisa, their accountant Paul Appleby-Walker, of Port Nawas, Falmouth, Cornwall, and Mr Brown's wife Maria, who also worked for Ikea - were cleared of corruption charges when the crown offered no evidence.

The defendants were granted bail, and will be sentenced on 11 October.

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