This afternoon the ASX Limited (ASX: ASX) announced the immediate resignation of its chief executive Elmer Funke Kupper, amidst news reports of an investigation by the Australian Federal Police (AFP) into Tabcorp Holding Limited's (ASX: TAH) business dealings in Cambodia in 2009/2010.
Mr Funke Kupper was chief executive of Tabcorp over the period under investigation and has been chief executive of the ASX since 6 October 2011.
Tabcorp also made an announcement to the ASX this afternoon stating that it was aware of the investigations and that Mr Funke Kupper has requested a leave of absence from a role on the Tabcorp board, while the AFP continues its investigations.
According to news reports in the Fairfax press the AFP are investigating a $200,000 payment made by Tabcorp to family members of Cambodian prime minister Hun Sen. The payment was allegedly made at a time when Tabcorp was looking to gain potentially new business opportunities in Cambodia.
The fact that Mr Funke Kupper has been effectively forced into quitting his role as head of the ASX suggests the investigation has the potential to escalate, with Tabcorp's activities likely to be under the microscope.
In 2015 Tabcorp had civil proceedings brought against it by the Australian anti-money laundering regulator AUSTRAC over a separate matter. However, today's news of alleged illegal payments looks like it could cause potentially more serious problems. Tabcorp investors then would do well to follow this story closely.
