Hagens Berman Blog

Whistleblower News: Auditors, Mozambique, Bribery

by HB Whistleblower Legal Team

03/08/2019

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Four of a Kind - "the pinstripe mafia."

Corporations and governments around the world are dependent on four major auditing companies – and so far, every attempt to rein in the Big Four's power and influence has failed. It is an untenable situation.

Even if clients get punished, their quiet accomplices escape unscathed

In recent years, these four companies have repeatedly played key roles in a spate of major scandals, including some that have been investigated by the SZ, such as the Luxembourg Leaks and the Panama Papers. But even when the Big Four were accessories to partly illegal or at least illegitimate acts, they have always managed to walk away unscathed. Even when their clients are publicly denounced or pilloried, hardly anything ever sticks to the Big Four. One of the most internationally renowned experts on the Big Four is also one of their loudest critics: the British economics professor Prem Sikka. Rather than using the term Big Four, he refers to them as "the pinstripe mafia." read more »

U.S. Identifies Key Mozambique Officials in Unsealed Indictment

The U.S. Department of Justice identified a former senior Mozambican intelligence official and an ex-employee in the office of the president in an indictment alleging they used more than $200 million of state funds for bribes and kickbacks.

The charges stem from a scandal involving $2 billion of loans the government raised in 2013 and 2014 and the bulk of which it hid from the International Monetary Fund and other donors. That led to a financing freeze when the debt was uncovered two years later. The government has missed payments on the obligations, as well as its $727 million of Eurobonds, since early 2017, as it sought to restructure them.

“The indictment unsealed today alleges a brazen international criminal scheme in which corrupt Mozambique government officials, corporate executives, and investment bankers stole approximately $200 million in loan proceeds that were meant to benefit the people of Mozambique,” Assistant Attorney General Brian Benczkowski said Thursday in a statement. read more »

Ex-Uzbek Leader’s Daughter Charged in $865 Million Bribery Scheme

Russian telecommunications company were indicted in what prosecutors called one of the largest bribery schemes ever prosecuted under the Foreign Corrupt Practices Act.

Federal prosecutors in New York announced criminal charges against Gulnara Karimova, 46, and Bekhzod Akhmedov, 44, alleging a decade-long operation in which $865 million in bribes were paid to Karimova, who is a former Uzbek official and the daughter of Islam Karimov, leader of Uzbekistan from 1989 until his death in 2016.

Prosecutors allege that Akhmedov, the former general director of Uzdunrobita, a unit of Moscow-based Mobile TeleSystems PJSC, helped orchestrate the bribery scheme on behalf of MTS, the biggest mobile-telecom company in Russia, Veon Ltd. and Telia Co. AB. He is charged with two counts of violating the Foreign Corrupt Practices Act, a major U.S. anti-corruption law, one count of conspiracy to violate the FCPA and one count of money-laundering conspiracy. read more »

Swedbank under shareholder scrutiny over money-laundering report

Swedbank is facing pressure from some of its biggest shareholders to reveal more about what it knew about allegations of money-laundering linked to Danske Bank.

Six of Swedbank’s top 20 investors, collectively holding around 14.5 percent of its shares, told Reuters they were seeking more information from the Swedish lender, after a media report last month linked it to the scandal involving Danske. read more »