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Sonera Slammed Up

Light Reading
LR Mobile News Analysis
Light Reading
11/26/2002

If you're looking for a growth industry in which to invest, look no further than law enforcement in Scandinavia. First we had the LM Ericsson (Nasdaq: ERICY) spy ring scandal (see Cops Arrest Vendor Spies). OK, so that was nothing to do with the telecom business -- it was about some dodgy defense-related stuff instead -- but who's bothered with little details like that? Now we have the Finnish equivalent of the FBI (The National Bureau of Investigation) raiding the offices of national carrier Sonera Corp. (Nasdaq: SNRA) with alarming regularity to arrest people on suspicion of "gross violation." Jeepers! (See Sonera Execs Banged Up.) In addition to the four Sonera employees currently suspended from their jobs due to, er, incarceration, the carrier's former president and CEO, Kaj-Erik Relander, has also been arrested as he is "suspected on reasonable grounds for gross violation of secrecy of communications." For any of those charged and found guilty, the maximum sentence is three years behind bars -- by which time Sonera's so-called 3G services might even have a 3G network to run on (see 3G Redefined, Finnish Style). The sorry affair began back in October, when Finnish newspaper Helsingin Sanomat printed allegations that people involved with Sonera's Corporate Security Unit had "violated the secrecy of communications in 2000 and 2001." As a result, two Sonera employees were detained, one held "under arrest" and the other "held in imprisonment." At that time Sonera issued a statement that ended like this:

    Secrecy of communications is a sacred thing for Sonera, and we take the allegations made extremely seriously. The most important thing for Sonera is to have the matter investigated as thoroughly as possible to find out the truth. In order to ensure this, we have cooperated and will continue to cooperate fully with the authorities and help them in every way possible, says Harri Koponen, Sonera’s President & CEO.
The statement was signed off by "Jari Jaakkola, Executive Vice President, Corporate Communications and IR." If you want to ask Jaakkola for more details, you'll have to call him on his cell phone... he's one of the latest to be placed under "pre-trial detention." Ooops! According to Helsingin Sanomat reports, the gross violations relate to efforts by Sonera executives to trace a "mole" who was leaking confidential information about the carrier. The newspaper claims that individuals' phone records were retrieved in an effort to find out who was disseminating damaging details about bust-ups and disagreements involving senior management. Given their impending corporate nuptials, we wonder what the folk at Telia AB are making of this? Apparently none of this will affect the merger, which is on course to be completed in December. Whether the honeymoon has been called off is another matter altogether. — Ray Le Maistre, European Editor, Unstrung
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