With several men heading having reportedly resigned last week amid a flurry of controversy, site GamesIndustry.biz today reports from Swedish newspapers claiming to reveal suspicious connections between at least one former chief and organised crime in Sweden. Apparently, former boss Stefan Eriksson has previous convictions related to a Swedish mafia group, Eriksson receiving a ten-year sentence in 1994 for charges related to faking money and an attempted scam on a financial intuition. Eriksson was paid some three-million dollars during his tenure at Gizmondo Europe, despite the firm's massive losses, whilst the developer he co-owns (Northern Lights) was paid 3.5 million USD for games reportedly developed by other companies.

The newspaper report (from the Aftonbladet daily) states that Eriksson is believed to have been a member of the Uppsala Mafia, named after the town in Sweden where the group worked, and this is also where Gizmondo's Swedish office is located. Gizmondo's head of security, Johan Enander, is also said to be an ex-member of the gang, according to the Swedish newspaper report, who has previous convictions including assault. Another chief at the firm, Carl Freer, resigned last week it is believed, with both the former executives stating they will pursue other ventures. Freer even paid the firm 3 million USD in cash, to avoid 'the appearance' of any wrong-doing, though both he and Eriksson are reportedly owed 21 million USD by the firm from start-up loans.

The transactions of the firm under Freer and Eriksson are now to be scrutinised by an independent committee set up after recent financial filings came under scrutiny. Other senior chiefs are currently telling the press they were unaware of Eriksson's criminal links. The Gizmondo handheld launched in the last week. We'll keep you posted as and intrigue continues to rumble at the handheld manufacturer, whilst parent company Tiger Telematics look to the US to boost the ailing firm.

Source: GamesIndustry.biz

By Luke Guttridge