Pernod Ricard Executives Under Fire: Scandal Unveils Collusion and Legal Woes in India

An internal investigation reveals top executives in Pernod Ricard's Indian branch violated laws by colluding with retailers. Accused of money laundering, the company denies wrongdoing. Executives faced allegations of manipulating the retail market using unlawful financial guarantees. The scandal underscores major regulatory challenges for the spirits producer in India.

An internal investigation into Pernod Ricard's India operations revealed top executives were involved in unlawful collusion with New Delhi alcohol retailers, according to a document seen by Reuters. This discovery has cast a shadow over the spirits giant, despite public denials of wrongdoing by the company's representatives.

The Enforcement Directorate in India accused Pernod Ricard India of facilitating $24 million in corporate guarantees to assist retailers with license bids, thereby increasing sales of Pernod brands. This action allegedly breached India's financial laws, leading to significant legal hurdles for the company.

Despite the denial from Pernod Ricard's executives and the pursuit of dismissal of the allegations, the investigation findings suggest a larger conspiracy involving key personnel and other industry players. With India being Pernod's largest market, these legal challenges pose a significant threat to its business operations.

(With inputs from agencies.)