PwC Australia in talks to spin off units damaged by scandal - source
Lewis Jackson and Scott Murdoch
Fri, June 23, 2023
Logo of Price Waterhouse Coopers at office in Berlin
By Lewis Jackson and Scott Murdoch
SYDNEY (Reuters) -PricewaterhouseCoopers Australia is looking to sell its government, education and healthcare practice to private equity firm Allegro Funds, according to a person familiar with the matter, as the firm battles the fall out from a major scandal.
The scandal, which first broke in January, centres around a former PwC tax partner who had been advising the federal government on laws to prevent corporate tax avoidance and shared confidential information with colleagues who then used it to pitch to multinational companies for work.
While the scandal began in PwC's tax practice it has tainted the more lucrative government consulting business as a growing number of departments and organisations, including the Reserve Bank of Australia, pause or review work with the "big four" professional services firm.
A term sheet for a potential deal has been drawn up, the Australian Financial Review said when it first reported the story on Friday.
The sale could include roughly 100 partners and 1,000 staff, or 10% of the firm, the AFR added. PwC Australia made A$3 billion ($2.01 billion) in revenue last financial year.
A spokesperson said PwC does not comment on market speculation when asked for a response. Allegro Funds did not immediately respond to a request for comment. The person familiar with the sale plan could not be named as the information had not yet been made public.
Allegro Funds describes itself as a restructuring specialist with over A$4 billion ($2.68 billion) under management.
Acting PwC Australia chief executive Kristin Stubbins said last month the firm would "ringfence" its government consulting business and appoint a separate board to consider "strategic options for the business".
In a sign the scandal is beginning to impact PwC's private sector work, four major pension funds managing roughly A$750 billion froze work with the firm this month.
($1 = 1.4914 Australian dollars)
(Reporting by Lewis Jackson; Editing by Lincoln Feast & Simon Cameron-Moore)
Lewis Jackson and Scott Murdoch
Fri, June 23, 2023
Logo of Price Waterhouse Coopers at office in Berlin
By Lewis Jackson and Scott Murdoch
SYDNEY (Reuters) -PricewaterhouseCoopers Australia is looking to sell its government, education and healthcare practice to private equity firm Allegro Funds, according to a person familiar with the matter, as the firm battles the fall out from a major scandal.
The scandal, which first broke in January, centres around a former PwC tax partner who had been advising the federal government on laws to prevent corporate tax avoidance and shared confidential information with colleagues who then used it to pitch to multinational companies for work.
While the scandal began in PwC's tax practice it has tainted the more lucrative government consulting business as a growing number of departments and organisations, including the Reserve Bank of Australia, pause or review work with the "big four" professional services firm.
A term sheet for a potential deal has been drawn up, the Australian Financial Review said when it first reported the story on Friday.
The sale could include roughly 100 partners and 1,000 staff, or 10% of the firm, the AFR added. PwC Australia made A$3 billion ($2.01 billion) in revenue last financial year.
A spokesperson said PwC does not comment on market speculation when asked for a response. Allegro Funds did not immediately respond to a request for comment. The person familiar with the sale plan could not be named as the information had not yet been made public.
Allegro Funds describes itself as a restructuring specialist with over A$4 billion ($2.68 billion) under management.
Acting PwC Australia chief executive Kristin Stubbins said last month the firm would "ringfence" its government consulting business and appoint a separate board to consider "strategic options for the business".
In a sign the scandal is beginning to impact PwC's private sector work, four major pension funds managing roughly A$750 billion froze work with the firm this month.
($1 = 1.4914 Australian dollars)
(Reporting by Lewis Jackson; Editing by Lincoln Feast & Simon Cameron-Moore)
Thai Finance Chief Seeks Speedy Probe Into Stark Irregularities
Anuchit Nguyen
Thu, June 22, 2023
(Bloomberg) -- Thai regulators must speed up investigations of suspected accounting irregularities at Stark Corp. Pcl that’s triggered the nation’s biggest bond default in three years to restore investor confidence, according to Finance Minister Arkhom Termpittayapaisith.
The Securities & Exchange Commission and Stock Exchange of Thailand have been asked to quickly conclude their probe, Arkhom told reporters in Bangkok. Law enforcement agencies must bring charges against all individuals found to be in breach of laws, he said after meeting with officials from the SEC and the stock exchange about Stark on Thursday.
Investors have been hit by a slump in Stark Corp.’s shares that’s seen its market capitalization plummet to about $11 million from this year’s peak of $1.2 billion. The electric cables maker has defaulted on its bonds and a special audit revealed accounting irregularities in the past two years that’s left it with liabilities exceeding assets.
The Stark turmoil has also weighed on the broader market with investor sentiment already weakening over the delay in a pro-democracy coalition’s ability to muster enough support to form a government after last month’s general election. The benchmark SET index is down 9.6% this year, the biggest decliner in Asia, and closed at its lowest level since March 2021 on Thursday.
A quick resolution to the Stark is important “to rebuild investors’ confidence,” Arkhom said late Thursday. The SEC and the exchange were also ordered to improve their supervision of listed companies to quickly detect any irregularities, he said.
The Department of Special Investigation has agreed to investigate allegations of fraud by some of its former executives, Bangkok Post reported, citing Director-General Suriya Singhakamol. There is evidence suggesting Stark’s executives violated Securities and Exchange Act, the newspaper reported.
Anuchit Nguyen
Thu, June 22, 2023
(Bloomberg) -- Thai regulators must speed up investigations of suspected accounting irregularities at Stark Corp. Pcl that’s triggered the nation’s biggest bond default in three years to restore investor confidence, according to Finance Minister Arkhom Termpittayapaisith.
The Securities & Exchange Commission and Stock Exchange of Thailand have been asked to quickly conclude their probe, Arkhom told reporters in Bangkok. Law enforcement agencies must bring charges against all individuals found to be in breach of laws, he said after meeting with officials from the SEC and the stock exchange about Stark on Thursday.
Investors have been hit by a slump in Stark Corp.’s shares that’s seen its market capitalization plummet to about $11 million from this year’s peak of $1.2 billion. The electric cables maker has defaulted on its bonds and a special audit revealed accounting irregularities in the past two years that’s left it with liabilities exceeding assets.
The Stark turmoil has also weighed on the broader market with investor sentiment already weakening over the delay in a pro-democracy coalition’s ability to muster enough support to form a government after last month’s general election. The benchmark SET index is down 9.6% this year, the biggest decliner in Asia, and closed at its lowest level since March 2021 on Thursday.
A quick resolution to the Stark is important “to rebuild investors’ confidence,” Arkhom said late Thursday. The SEC and the exchange were also ordered to improve their supervision of listed companies to quickly detect any irregularities, he said.
The Department of Special Investigation has agreed to investigate allegations of fraud by some of its former executives, Bangkok Post reported, citing Director-General Suriya Singhakamol. There is evidence suggesting Stark’s executives violated Securities and Exchange Act, the newspaper reported.
JPMorgan Chase is fined by SEC after mistakenly deleting 47 million emails
Thu, June 22, 2023
By Jonathan Stempel
NEW YORK (Reuters) -JPMorgan Chase has been fined $4 million by the U.S. Securities and Exchange Commission after about 47 million emails belonging to its retail banking group were mistakenly and permanently deleted.
The emails dated from Jan. 1 to April 23, 2018, and were deleted in June 2019 from about 8,700 mailboxes, including those belonging to as many as 7,500 employees who regularly worked with customers.
Many of the emails were business records that the largest U.S. bank was required under SEC rules to keep for three years.
The deletions occurred after JPMorgan's corporate compliance technology department, which had been trying unsuccessfully to delete some communications from the 1970s and 1980s, sought help from an outside vendor managing the bank's email storage.
According to a cease-and-desist order, the vendor failed to properly apply the three-year retention setting to "Chase" emails from early 2018.
"As a result, the troubleshooting exercise permanently deleted all of the emails in that domain from that period which were not subject to legal holds," the order said.
JPMorgan, which is based in New York, did not admit or deny wrongdoing in agreeing to the civil settlement. It has adopted its own email coding procedures to avoid a recurrence.
"JPMorgan takes its record-keeping obligations seriously," the bank said in a statement.
According to the SEC, JPMorgan has been unable in at least 12 civil securities-related regulatory probes to comply with subpoenas and document requests for communications that had been permanently deleted.
(Reporting by Jonathan Stempel in New York; editing by Jonathan Oatis)
Thu, June 22, 2023
By Jonathan Stempel
NEW YORK (Reuters) -JPMorgan Chase has been fined $4 million by the U.S. Securities and Exchange Commission after about 47 million emails belonging to its retail banking group were mistakenly and permanently deleted.
The emails dated from Jan. 1 to April 23, 2018, and were deleted in June 2019 from about 8,700 mailboxes, including those belonging to as many as 7,500 employees who regularly worked with customers.
Many of the emails were business records that the largest U.S. bank was required under SEC rules to keep for three years.
The deletions occurred after JPMorgan's corporate compliance technology department, which had been trying unsuccessfully to delete some communications from the 1970s and 1980s, sought help from an outside vendor managing the bank's email storage.
According to a cease-and-desist order, the vendor failed to properly apply the three-year retention setting to "Chase" emails from early 2018.
"As a result, the troubleshooting exercise permanently deleted all of the emails in that domain from that period which were not subject to legal holds," the order said.
JPMorgan, which is based in New York, did not admit or deny wrongdoing in agreeing to the civil settlement. It has adopted its own email coding procedures to avoid a recurrence.
"JPMorgan takes its record-keeping obligations seriously," the bank said in a statement.
According to the SEC, JPMorgan has been unable in at least 12 civil securities-related regulatory probes to comply with subpoenas and document requests for communications that had been permanently deleted.
(Reporting by Jonathan Stempel in New York; editing by Jonathan Oatis)
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