Billionaire sex saga is latest scandal to hit Australia CEOs
Angus Whitley
Thu 24 October 2024
(Bloomberg) — The sex-for-investment scandal that swiftly deposed Australian tech billionaire Richard White is just the latest corporate calamity in a country fast losing its reputation as a tightly-regulated market with strict governance standards.
More than A$7.7 billion ($5.1 billion) of market value has been wiped from WiseTech Global Ltd. (AU000000WTC3.SG, WIGBY) this week before White suddenly stepped down as chief executive officer late Thursday. His resignation followed a series of ever-worsening media reports and claims, including that he’d paid millions of dollars to a former partner to settle allegations of inappropriate behavior.
Ultimately, White’s three-decade tenure at the helm of the freight-software giant he founded unraveled in four tumultuous days.
The crisis finally overwhelmed WiseTech and its figurehead CEO on Thursday after the Australian Financial Review reported a former board member had accused White of intimidation and bullying. The newspaper earlier said White also had a years-long relationship with an employee before gifting her a A$7 million waterfront house in Melbourne. The transaction wasn’t disclosed to the board, the report said.
Richard White, CEO of Wisetech, in Alexandria. August 13th, 2024 (Photo by Dominic Lorrimer / The Australian Financial Review via Getty Images) · Fairfax Media via Getty Images
While the statement announcing White’s departure didn’t address the multiple allegations leveled at the former CEO, WiseTech said law firms Herbert Smith Freehills and Seyfarth Shaw LLP have been hired to assist a board investigation into the claims.
White isn’t leaving the company completely. After taking a short break he will commence a new role focused on product and business development. His new 10-year contract as a consultant comes with a two-year notice period, while his A$1 million annual salary is unchanged.
Cascading Scandals
In a matter of months, accusations of operational or ethical failures have also hit Australia’s two dominant supermarkets, one of the major banks, the largest insurer, the biggest listed media company and Sydney’s main casino.
Another tycoon founder, Mineral Resources Ltd.’s (MIN.AX) Chris Ellison, also this week found himself embroiled in scandal with the company investigating historic undeclared payments that helped him avoid tax. Australia’s corporate watchdog has launched a probe, and almost A$2 billion has been slashed from the miner’s market value since Monday.
The mining magnate described his actions in a statement on Monday as “a poor decision and a serious lapse of judgment.” He had subsequently “voluntarily” disclosed the matters to the Australian Taxation Office in full, with all outstanding tax, penalties and interest repaid. The company’s board said earlier this week it retained confidence in Ellison.
While executive or corporate transgressions are a worldwide phenomenon, it seems to be particularly pronounced in Australia, where a confluence of factors come into play. Many of the country’s largest industries — aviation, banking, groceries and retailing — are duopolies or oligopolies, comfortable environments that can be conducive for market-power abuse.
Australia is home to only 27 million people and has a relatively small pool of independent board directors to oversee listed companies. Many directors have roles at multiple businesses. Advocacy groups have long said board members are reluctant to speak out when standards lapse at one company for fear of losing a board position at another firm.
That’s not the only problem. Some of the country’s watchdogs are either short of resources, have few corporate scalps to their name, or dish out fines that do little to deter bad behavior. Star Entertainment Group Ltd. (SGR.AX) was this month fined just A$15 million — less than 1% of revenue — by its regulator after an inquiry found the casino operator had breached its license several times and was unfit to run its flagship Sydney complex, despite having had two years to address its problems.
The head of a Senate inquiry into the Australian Securities and Investments Commission, the country’s primary corporate regulator, in July described the agency as “an organization without transparency, few prosecutions, and a litany of cultural, structural and governance issues.”
One of the most damning assessments of an Australian workplace came only last week when Nine Entertainment Co. (NEC.AX), publisher of the Sydney Morning Herald and the AFR, released an independent review of its own practices. The report uncovered systemic abuses of power and authority, bullying, discrimination and sexual harassment.
At too many businesses, internal governance measures aren’t detecting problems before they develop into major public scandals, said Rahat Munir, a professor at Macquarie University’s business school who leads the department of accounting and corporate governance. Australia’s geographical remoteness, far from the world’s major financial and corporate hubs, means its companies risk operating in their own bubble, he said.
“As a result, it’s very, very easy to manipulate the local market,” he said.
WiseTech Woes
In a country with one of the planet’s biggest pension pools, where worker contributions are mandatory, everyday savers are picking up the tab when stock prices decline.
At WiseTech, shareholders who have suffered losses this week include Australia’s sovereign wealth fund, along with its largest pension fund, AustralianSuper Pty. WiseTech shares fell 6.3% Thursday.
“We should all be concerned that these are not isolated examples, but a pattern of behavior that is causing direct losses to shareholders,” said Brendan Lyon, a professor with the University of Wollongong’s faculty of business and law. Corporate regulation is failing, Lyon said.
Former director Christine Holman accused White of “sustained intimidation and bullying” as she quit the board in October 2019 after less than a year, the AFR reported Thursday. The AFR said it wasn’t suggesting White bullied or intimidated Holman, only that she accused him of doing so. Holman declined to comment to the newspaper.
AGL Energy Ltd., where Holman is now a board member, forwarded her an interview request from Bloomberg News earlier this week, which she declined. AGL didn’t reply to a fresh request from Bloomberg on Thursday for comment from Holman on her reported resignation letter from WiseTech.
He last week reached an out-of-court settlement with an another alleged former lover he was pursuing for bankruptcy, the case that first thrust him into the media spotlight. The woman had alleged White expected her to have sex with him in exchange for an investment in her business.
—With assistance from Amy Bainbridge, Ainsley Thomson and Georgina McKay.
Most Read from Bloomberg Businessweek
While the statement announcing White’s departure didn’t address the multiple allegations leveled at the former CEO, WiseTech said law firms Herbert Smith Freehills and Seyfarth Shaw LLP have been hired to assist a board investigation into the claims.
White isn’t leaving the company completely. After taking a short break he will commence a new role focused on product and business development. His new 10-year contract as a consultant comes with a two-year notice period, while his A$1 million annual salary is unchanged.
Cascading Scandals
In a matter of months, accusations of operational or ethical failures have also hit Australia’s two dominant supermarkets, one of the major banks, the largest insurer, the biggest listed media company and Sydney’s main casino.
Another tycoon founder, Mineral Resources Ltd.’s (MIN.AX) Chris Ellison, also this week found himself embroiled in scandal with the company investigating historic undeclared payments that helped him avoid tax. Australia’s corporate watchdog has launched a probe, and almost A$2 billion has been slashed from the miner’s market value since Monday.
The mining magnate described his actions in a statement on Monday as “a poor decision and a serious lapse of judgment.” He had subsequently “voluntarily” disclosed the matters to the Australian Taxation Office in full, with all outstanding tax, penalties and interest repaid. The company’s board said earlier this week it retained confidence in Ellison.
While executive or corporate transgressions are a worldwide phenomenon, it seems to be particularly pronounced in Australia, where a confluence of factors come into play. Many of the country’s largest industries — aviation, banking, groceries and retailing — are duopolies or oligopolies, comfortable environments that can be conducive for market-power abuse.
Australia is home to only 27 million people and has a relatively small pool of independent board directors to oversee listed companies. Many directors have roles at multiple businesses. Advocacy groups have long said board members are reluctant to speak out when standards lapse at one company for fear of losing a board position at another firm.
That’s not the only problem. Some of the country’s watchdogs are either short of resources, have few corporate scalps to their name, or dish out fines that do little to deter bad behavior. Star Entertainment Group Ltd. (SGR.AX) was this month fined just A$15 million — less than 1% of revenue — by its regulator after an inquiry found the casino operator had breached its license several times and was unfit to run its flagship Sydney complex, despite having had two years to address its problems.
The head of a Senate inquiry into the Australian Securities and Investments Commission, the country’s primary corporate regulator, in July described the agency as “an organization without transparency, few prosecutions, and a litany of cultural, structural and governance issues.”
One of the most damning assessments of an Australian workplace came only last week when Nine Entertainment Co. (NEC.AX), publisher of the Sydney Morning Herald and the AFR, released an independent review of its own practices. The report uncovered systemic abuses of power and authority, bullying, discrimination and sexual harassment.
At too many businesses, internal governance measures aren’t detecting problems before they develop into major public scandals, said Rahat Munir, a professor at Macquarie University’s business school who leads the department of accounting and corporate governance. Australia’s geographical remoteness, far from the world’s major financial and corporate hubs, means its companies risk operating in their own bubble, he said.
“As a result, it’s very, very easy to manipulate the local market,” he said.
WiseTech Woes
In a country with one of the planet’s biggest pension pools, where worker contributions are mandatory, everyday savers are picking up the tab when stock prices decline.
At WiseTech, shareholders who have suffered losses this week include Australia’s sovereign wealth fund, along with its largest pension fund, AustralianSuper Pty. WiseTech shares fell 6.3% Thursday.
“We should all be concerned that these are not isolated examples, but a pattern of behavior that is causing direct losses to shareholders,” said Brendan Lyon, a professor with the University of Wollongong’s faculty of business and law. Corporate regulation is failing, Lyon said.
Former director Christine Holman accused White of “sustained intimidation and bullying” as she quit the board in October 2019 after less than a year, the AFR reported Thursday. The AFR said it wasn’t suggesting White bullied or intimidated Holman, only that she accused him of doing so. Holman declined to comment to the newspaper.
AGL Energy Ltd., where Holman is now a board member, forwarded her an interview request from Bloomberg News earlier this week, which she declined. AGL didn’t reply to a fresh request from Bloomberg on Thursday for comment from Holman on her reported resignation letter from WiseTech.
He last week reached an out-of-court settlement with an another alleged former lover he was pursuing for bankruptcy, the case that first thrust him into the media spotlight. The woman had alleged White expected her to have sex with him in exchange for an investment in her business.
—With assistance from Amy Bainbridge, Ainsley Thomson and Georgina McKay.
Most Read from Bloomberg Businessweek
Arrested Philippine televangelist confronted in the Senate by women he's accused of sexually abusing
JIM GOMEZ and AARON FAVILA
Wed, October 23, 2024 at
Philippine Foreign Affairs Secretary Enrique Manalo, right, talks beside Undersecretary Gary Domingo and Commission on Human Right Chairperson Richard Palpal-latoc, right, attend a senate inquiry for detained Filipino preacher Apollo Quiboloy at the Philippine Senate Wednesday, Oct. 23, 2024, in Manila, Philippines. (AP Photo/Aaron Favila)
MANILA, Philippines (AP) — Former followers of an arrested Filipino televangelist confronted him in a Senate hearing Wednesday, accusing him of repeatedly abusing them sexually by portraying the assaults as their religious duty to the “appointed son of God."
Apollo Carreon Quiboloy, who was brought to the Senate under heavy police security, denied the allegations from several women, including some from Ukraine as well as the Philippines. He challenged his accusers to file criminal complaints so he could face them in court.
The 74-year-old preacher said he could not discuss his response because criminal charges against him, including sexually abusing women and human trafficking, were already being heard in two Philippine courts.
Yulya Voronina told the Senate hearing through a video link from Ukraine that Quiboloy and his key aides allegedly forced her and other victims into agreeing to have sex with him through religious deception and coercion.
"They always used the Bible as an instrument to convince us to do it,” she said, adding that at least nine other Ukrainian women became members of Quiboloy’s group, the Kingdom of Jesus Christ, based in the southern Philippine city of Davao.
The women took steps to avoid being sexually abused but Voronina said Quiboloy had access to their rooms in the sprawling religious complex, and his aides also helped coerce them into submission.
"If you say, `I don’t want,’ Quiboloy would say, `you will go to hell,’” Voronina said. “They will punish and call us, scold us in a meeting and put us in shame, saying that we were ungrateful because the pastor gave us everything.”
She managed to leave eventually and returned to Ukraine.
Filipina Teresita Valdehueza testified at the Senate hearing that she became a member of Quiboloy’s church at age 17 in 1980 as part of her deep faith. She revered him for years but said she was also sexually abused by him eventually in a Philippine hotel like three other Filipino women she knew who alternately slept with him.
Quiboloy “violated me with his lustful act that left me in shock," Valdehueza said. After the assault, she said he told her, “This is the fulfillment of God’s revelation."
“Quiboloy presented himself like a god and gradually took over the mind and bodies of his victims,” said Sen. Risa Hontiveros, who led the Senate hearing. He “presided over a malicious and systematic subversion of personal will, autonomy and dignity to make his victims participants in their own abuse — psychological, sexual, physical and economic.”
Philippine police officials investigating Quiboloy told senators that up to 200 women may have been victimized by him over many years, including 68 sexual abuse victims who have been identified by them.
Aside from the criminal charges he's facing in two Philippine courts, Quiboloy may have to answer more criminal complaints, according to police officials, who alleged during the Senate hearing that Quiboloy's organization maintained an armed group, which may have committed criminal violations.
Once among the most influential religious televangelists in the Philippines, Quiboloy backed the successful 2016 candidacy of President Rodrigo Duterte, whose deadly anti-drugs crackdown is being investigated by the International Criminal Court as a possible crime against humanity.
In response to a question, Quiboloy told the Senate that his church has about 7 million members and supporters worldwide. But police officials disputed his claim and said he has fewer than 8,000 followers in the Philippines and abroad.
Early this year, Quiboloy went into hiding after a Philippine court ordered his arrest and that of several others over allegations of child and sexual abuse and human trafficking. The Philippine Senate separately ordered his arrest for failing to appear at committee hearings investigating the allegations.
He faced similar criminal charges in the United States, where federal prosecutors in 2021 announced his indictment, along with two of his top administrators. The expanded indictment contained a raft of charges, including conspiracy, sex trafficking of children, sex trafficking by force, fraud and coercion, marriage fraud, money laundering, cash smuggling and visa fraud.
A U.S. federal warrant for Quiboloy’s arrest was issued in November 2021 and he landed on the FBI’s most-wanted list, his face splashed on the agency’s globally circulated posters of fugitives.
Philippine Foreign Secretary Enrique Manalo told the Senate hearing there has been no request by the United States so far for Quiboloy's extradition. The preacher has accused U.S. authorities of conspiring with President Ferdinand Marcos Jr. against him, a charge the Philippine leader has denied.
JIM GOMEZ and AARON FAVILA
Wed, October 23, 2024 at
Philippine Foreign Affairs Secretary Enrique Manalo, right, talks beside Undersecretary Gary Domingo and Commission on Human Right Chairperson Richard Palpal-latoc, right, attend a senate inquiry for detained Filipino preacher Apollo Quiboloy at the Philippine Senate Wednesday, Oct. 23, 2024, in Manila, Philippines. (AP Photo/Aaron Favila)
MANILA, Philippines (AP) — Former followers of an arrested Filipino televangelist confronted him in a Senate hearing Wednesday, accusing him of repeatedly abusing them sexually by portraying the assaults as their religious duty to the “appointed son of God."
Apollo Carreon Quiboloy, who was brought to the Senate under heavy police security, denied the allegations from several women, including some from Ukraine as well as the Philippines. He challenged his accusers to file criminal complaints so he could face them in court.
The 74-year-old preacher said he could not discuss his response because criminal charges against him, including sexually abusing women and human trafficking, were already being heard in two Philippine courts.
Yulya Voronina told the Senate hearing through a video link from Ukraine that Quiboloy and his key aides allegedly forced her and other victims into agreeing to have sex with him through religious deception and coercion.
"They always used the Bible as an instrument to convince us to do it,” she said, adding that at least nine other Ukrainian women became members of Quiboloy’s group, the Kingdom of Jesus Christ, based in the southern Philippine city of Davao.
The women took steps to avoid being sexually abused but Voronina said Quiboloy had access to their rooms in the sprawling religious complex, and his aides also helped coerce them into submission.
"If you say, `I don’t want,’ Quiboloy would say, `you will go to hell,’” Voronina said. “They will punish and call us, scold us in a meeting and put us in shame, saying that we were ungrateful because the pastor gave us everything.”
She managed to leave eventually and returned to Ukraine.
Filipina Teresita Valdehueza testified at the Senate hearing that she became a member of Quiboloy’s church at age 17 in 1980 as part of her deep faith. She revered him for years but said she was also sexually abused by him eventually in a Philippine hotel like three other Filipino women she knew who alternately slept with him.
Quiboloy “violated me with his lustful act that left me in shock," Valdehueza said. After the assault, she said he told her, “This is the fulfillment of God’s revelation."
“Quiboloy presented himself like a god and gradually took over the mind and bodies of his victims,” said Sen. Risa Hontiveros, who led the Senate hearing. He “presided over a malicious and systematic subversion of personal will, autonomy and dignity to make his victims participants in their own abuse — psychological, sexual, physical and economic.”
Philippine police officials investigating Quiboloy told senators that up to 200 women may have been victimized by him over many years, including 68 sexual abuse victims who have been identified by them.
Aside from the criminal charges he's facing in two Philippine courts, Quiboloy may have to answer more criminal complaints, according to police officials, who alleged during the Senate hearing that Quiboloy's organization maintained an armed group, which may have committed criminal violations.
Once among the most influential religious televangelists in the Philippines, Quiboloy backed the successful 2016 candidacy of President Rodrigo Duterte, whose deadly anti-drugs crackdown is being investigated by the International Criminal Court as a possible crime against humanity.
In response to a question, Quiboloy told the Senate that his church has about 7 million members and supporters worldwide. But police officials disputed his claim and said he has fewer than 8,000 followers in the Philippines and abroad.
Early this year, Quiboloy went into hiding after a Philippine court ordered his arrest and that of several others over allegations of child and sexual abuse and human trafficking. The Philippine Senate separately ordered his arrest for failing to appear at committee hearings investigating the allegations.
He faced similar criminal charges in the United States, where federal prosecutors in 2021 announced his indictment, along with two of his top administrators. The expanded indictment contained a raft of charges, including conspiracy, sex trafficking of children, sex trafficking by force, fraud and coercion, marriage fraud, money laundering, cash smuggling and visa fraud.
A U.S. federal warrant for Quiboloy’s arrest was issued in November 2021 and he landed on the FBI’s most-wanted list, his face splashed on the agency’s globally circulated posters of fugitives.
Philippine Foreign Secretary Enrique Manalo told the Senate hearing there has been no request by the United States so far for Quiboloy's extradition. The preacher has accused U.S. authorities of conspiring with President Ferdinand Marcos Jr. against him, a charge the Philippine leader has denied.
Former Abercrombie and Fitch CEO Mike Jeffries is arrested for sex trafficking
Athena Stavrou
Tue 22 October 2024
ABERCROMBIE-&-FITCH-CEO ARRESTO (AP)
The former CEO of fashion giant Abercrombie & Fitch has been arrested on sex trafficking charges following a major FBI investigation.
Mike Jeffries, his partner Matthew Smith and another alleged middleman were arrested on Tuesday morning in connection with a federal sex-trafficking and interstate prostitution probe.
The investigation was opened last year following claims that Mr Jeffries and his partner had sexually abused and exploited men at events in New York and around the world.
A lawyer representing some of the alleged victims confirmed the arrests in a statement to the BBC and said: “These arrests are a huge first step towards obtaining justice for the many victims who were exploited and abused through this sex-trafficking scheme that operated for many years under the legitimate cover Abercrombie provided.”
Mr Jeffries and Mr Smith have both previously denied any wrongdoing.
(BERTRAND GUAY/AFP via Getty Images)
The former boss of the international clothing company stepped down in 2014 following declining sales. He left with a retirement package valued at around £20.5m ($25m) according to company filings at the time.
He was then subsequently accused of running a sex trafficking operation. Under US law, sex trafficking includes getting an adult to travel to another state or country to have sex for money by using force, fraud or coercion.
David Bradberry, a former model for Abercrombie & Fitch, sued the fashion retailer alleging it allowed Mr Jeffries to run the alleged operation during his 22-year tenure at the helm.
Bradberry, then 23, said that it was “made clear” to him that without performing oral sex on the alleged middleman, he would not be meeting Mr Jeffries.
“It was like he was selling fame. And the price was compliance,” Mr Bradberry told the BBC.
ABERCROMBIE-&-FITCH-CEO ARRESTO (AP)
Mr Bradberry said he later attended a party at Mr Jeffries’s mansion in the Hamptons in Long Island where he met Mr Jeffries and had sex with him.
The lawsuit was filed following a BBC investigation that found that Mr Jeffries and his British partner allegedly exploited young adult men for sex at events hosted by them in London, New York, and Marrakesh.
It accused Mr Jeffries of exploiting his position to “ensnare” more than 100 male victims with free clothes and gift cards, and false promises about modeling opportunities, according to the Delaware complaint.
Abercrombie & Fitch in a statement in October said: “For close to a decade, a new executive leadership team and refreshed board of directors have successfully transformed our brands and culture into the values-driven organization we are today.”
“We have zero tolerance for abuse, harassment or discrimination of any kind.”
No comments:
Post a Comment