Posts

Showing posts from March, 2015

Is KPMG being "Enroned"?-Similarities to the Tricontinental matter in Australia

The following is an excerpt from a report by Roger Trapp in The Independent , Wednesday 26 January 1994 THE ACCOUNTANCY firm KPMG Peat Marwick is to pay the Victoria state government Adollars 136m (pounds 63.6m) to settle a court case arising from the collapse of the merchant bank Tricontinental Group. The Tricontinental case stemmed from KPMG Australia's audit of the accounts of the bank, which collapsed in 1990 with a shareholders' funds deficit of AUD 2.6bn. At the time the bank was owned by the state government of Victoria , but it was sold to the Commonwealth Bank of Australia after the collapse. KPMG Australia 's executive chairman, John Harkness, agreed that the deal was the only practical solution to a very difficult situation. 'The sheer enormity of this case made the prospect of pursuing justice through the usual legal channels totally impractical,' he said. In a sense, Tricontinental  Merchant Bank was to the State Bank Of Victoria what 1 MDB is to the ...

Is KPMG International being "EnRoned"? : Fallout from Malaysia's 1 MDB scandal may cost KPMG USD 10 billion

A new verb, "Enron-ed" was coined by John M. Cunningham, the former Arthur Andersen Director in the Seattle Office, to describe the demise of Arthur Andersen. KPMG International ,the Swiss Cooperative under which KPMG partnerships worldwide come together to offer audit and other services under the direction of a Global Executive Leadership Team,  has found itself entangled in Malaysia's 1 MDB sovereign wealth fund scandal.  It appears that in managing the crisis it now faces, KPMG may be managing its 1 MDB documents in a manner  similar  to   Arthur Andersen and its  documents related to the  Enron assignment which led to the effective demise of that firm which was once considered the gold standard in auditing.  The Sarawak Report website that has in recent weeks published 1 MDB  emails  that reveal gross financial impropriety,  recently published email correspondence between 1 MDB and its former auditor, the KPMG partnership ...

Bombadier announced its $2-3 billion CS100 deal knowing the deal is and remains unfunded

Bombadier Inc , a company listed on the Canadian Stock Exchange, presumably in the interest of keeping the market fully informed, announced on  17 March 2015 : Bombardier Commercial Aircraft and Fly Mojo Sdn Bhd announced today that the parties have signed a Letter of Intent (LOI) for the sale and purchase of 20 CS100 aircraft with options for an additional 20 CS100 aircraft. Based on the list price of the CS100 aircraft, a firm order would be valued at approximately $1.47 billion US, and could increase to $2.94 billion US, should flymojo exercise all its options. Flymojo is , in relative terms, nothing more than a shell, with a paid-up capital of only USD 1.million, and nothing else . When asked about its funding for the deal the company first claimed to be backed by private equity, but then under interrogation said: "flymojo is working alongside Bombardier and third parties to source potential financing solutions. " It appears then that Bombadier has made its announcement...

Brandis & Sherburn will place the CVE programme above law enforcement: Which one of them will bear greater responsibility when they fail?

Image
The following excerpt is from Australian Public Service's Gazette.It describes what the newly formed Countering Violent Extremism (CVE) Section will do: Working with community and government partners,  we emphasise  intervening early –  addressing violent extremism before a law enforcement response is required . This critical, internationally recognised work is complex, exciting and rewarding. The CVE Section is headed by one Anna Sherburn.As her profile suggests, her background is in  human rights (and marketing ,media liaison). Her background is likely to  ensure that intelligence on individuals who are the subject of intervention  will not be conveyed to law enforcement.To do so would contradict her objective. Regardless, it is more likely than not that the CVE will fail (ask the Malaysians,Indonesians etc etc) and that the general public will suffer the consequences .When that happens, Ms Sherburn, and her Minister, one George Brandis, ought t...

Goldman Sach's Roger Ng," leaves behind a controversial legacy with regard to 1MDB.": He should be found,and questioned by the Malaysian AG's 1MDB task force

As written  by Jonathan Green of IFR Asia : It emerged last week that a gentleman called Roger Ng has departed from Goldman Sachs, where he had most recently headed up South-East Asian sales in the US titan’s fixed-income, currencies and commodities unit. It’s no secret that Goldman has done rather nicely from its fixed-income business in Malaysia, and Mr Ng’s connections within the country are often hailed as the root of those successes.  There’s no doubt, however, that he leaves behind a controversial legacy with regard to 1MDB . It is hard to see how, when even the Malaysian Prime Minister Najib is being investigated with regards the 1 MDB scandal, Mr Ng is not. He needs to be found and interrogated.  The US Government ought to cooperate in the matter, if it is in fact serious about fighting corruption.

US criticised for not probing Goldman Sach’s role in 1MDB

by Ganesh Sahathevan The Foreign Corrupt Practices Act of 1977, as amended, 15 U.S.C. §§ 78dd-1, et seq. (" FCPA "), was enacted for the purpose of making it unlawful for certain classes of persons and entities to make payments to foreign government officials to assist in obtaining or retaining business ( http://www.justice.gov/crimin al/fraud/ fcpa / ). Goldman's client in this case was the Malaysian Government and/or an agency it owns and controls, 1Malaysia Development Bhd. US criticised for not probing Goldman Sach’s role in 1MDB

1 MDB audit: AG must & will find that loss of RM 7 billion in cash was in accordance with proper procedures,accepted accounting practise

by Ganesh Sahathevan The outcome of the 1 MDB audit ordered by the Prime Minister,and which is to be undertaken by the Auditor-General must and will conclude that the loss of some RM 7 billion in cash from or via 1 MDB was really in accordance with proper procedures,accepted accounting practice ,and therefore the company and its directors are free of blame. The reasons are simple. First, the RM 4 billion borrowed from the KWAP and  funneled  by 1 MDB into its FORMER  subsidiary ,  SRC   International  Sdn Bhd. Now, this is really a non-issue,for SRC was "de-merged" and is no longer a 1 MDB subsidiary, so really it is no longer of any concern to anyone auditing 1 MDB. However, for those who insist, really, can you say that 1 MDB's directors have been negligent in getting rid of a RM 4 billion liability? Did the de-merger not add value to the company,and hence in its best interest?  Need we explain the basics of good governance?  (See repo...