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English businessman, former employees convicted on IKEA bribes

A former supplier to Swedish retailer IKEA has been convicted on 18 counts of corruption for admitting he paid 1.4 million pounds (US$2.7 million) for purchasing deals with the retailer, according to BBC News.

Through a group of five companies, Adam Hauxwell-Smith supplied products including potpourri, candles and crackers to IKEA. He was sentenced to three years in prison following a six-year-long corruption probe.

Two IKEA employees also have been sentenced in the corruption probe – IKEA buyer John Brown was sentenced to two years, while sales leader Paul Hoult received a sentence of 13 months. The bribes took place between January 1998 and February 2000, according to a press release from the United Kingdom Serious Fraud Office.

Hauxwell-Smith paid the employees to override IKEA’s “turnover rule,” which said the retailer would not take more than 40 percent of a supplier’s turnover with the aim of keeping suppliers from being too reliant on IKEA’s business.

According to the fraud office, the investigation was initiated by IKEA’s U.K. branch. The investigation began in February 2001.

According to its Web site, IKEA has 17 retail locations in the U.K.


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