Europe

BT shares plunge on cost of Italian accounting scandal

Shares in London-based BT have plunged by almost a fifth after the telecommunications company warned on profits and said the cost of an accounting scandal at its Italian business is bigger than expected.

BT had said in October that it was investigating the practices of its Italian business and had taken a charge of 145 million pounds (US$182 million.) On Tuesday, it said that it was increasing those charges to 530 million pounds.

BT said the investigation revealed improper accounting practices and the improper sale, purchase and leasing of deals.

The company, which is due to publish its full earnings on Friday, also reduced its earnings outlook. Its shares were down 19 percent at 311.70 pence in London Tuesday morning.