The "dominating management styles" of some executives caused Xeroxs Mexican subsidiary to supply misinformation, according to an independent investigation.


Xerox hired Akin, Gump, Strauss, Hauer & Field and PricewaterhouseCoopers to find out whether its employees were breaching its policies or accounting and record-keeping standards.


"Several managers of Xerox Mexico circumvented well-established corporate accounting and ethics policies and practices, and engaged in collusion," said Xerox chief financial officer Barry Romeril. The managers concerned have been "promptly removed from their positions".


Last summer Xerox issued its fifth profit warning, causing shares to fall by 3.02 to 13.72 (PrintWeek, 23 June 2000), even though it had published infor-mation saying it was experiencing strong growth in Mexico.


As a result a class action lawsuit was filed against Xerox last September for publishing misleading information regarding its financial status.


During the investigation Xerox also launched a worldwide assessment of its internal auditing and established that its Mexican branchs issues were not present elsewhere.


Romeril also said the actions of the managers had led to "a broken trust with our customers and a troubling sense of dishonour shouldered by all our conscientious Xerox Mexico employees".