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HCU/Clico Commission of Enquiry PWC auditor under fire for withholding info (with CNC3 video)
The existence of a PriceWaterhouseCoopers (PWC) policy of not leaving a “paper trail” of evidence that might embarrass the company came up yesterday when the HCU/Clico Commission of Enquiry continued in Port-of-Spain. Asking the question of PWC auditor Keith Daniel was Edwin Glasgow, attorney for the commission. Glasgow raised the issue on the fourth day of the 11th session of the commission at the Winsure Building. He was referring to the relationship between the Central Bank regulators and PWC lawyers.
“You are saying that the regulator will not be able to get any information out of you?” Glasgow asked. Daniel replied: “The regulator came to us and asked about the inter-company balances and I showed it over the time where the amount was being reduced and there were also transfers of assets.” Glasgow asked: “What it says in the minutes of the second paragraph on page 39 is that you, ‘KD,’ emphasised that the Inspector of Financial Institutions cannot investigate balances through PWC without a request.
“It also said they will not find what they were looking for from PWC records. “Do you think that you had a professional duty to be professional with the Central Bank and to tell them the truth that was going on?” Daniel said, “What they were trying to ensure was that those payments were not being recorded as expenses in the books, as we know. They wanted to know how the inter-company balances were being reduced.”
Glasgow again asked:“Was there in fact a policy in PWC not leaving a paper trail of things that might lead to embarrassment for a client? Did you have a policy saying that you would not put that in writing?” Daniel replied: “I am not sure if that was a policy or not. Whenever the regulators spoke to us, I always dealt with them.”
Glasgow said: “In a few pages further on, you appear to be telling people not to send you e-mails. It is on page 47. You end your e-mail on page 47 with the words, ‘If you have any questions do not send an e-mail.’ It is an e-mail [dated] March 18, 2006 and ends with capital letters.” Daniel replied: “I cannot recall that, as you are going back all the way to 2006.”
Later, after lunch, chairman of the enquiry Sir Anthony Colman reprimanded PWC’s lawyers for producing fraud risk reports on CL Financial companies only yesterday. He said: “It is a serious situation. It seems as long ago as three or four months before this hearing that material was requested. Specific requests that were made seems to have fallen on deaf ears, and this is the real concern here. “It did not just fall on deaf ears once, it fell on deaf ears repeatedly,” Colman added.
“It is a very serious situation where an organisation with this reputation and size of PWC had failed to provide the co-operation that is quite fundamental for the work of the enquiry. That seems to be an unsatisfactory situation.” Glasgow asked for a short adjournment, which Colman granted so all parties could examine the fraud risk reports. He called the documents some of the most crucial to be made available to the commission.
“As I understand, 19 fraud risk reports were produced this morning. Attorneys delivered to the commission disk drives which contain 1,000 documents.” Attorney for PWC Russell Martineau apologised for producing the documents only yesterday. Haseeb Mohammed, auditor for PWC, also testified yesterday and said things became “heated” in 2008 when Clico Investment Bank (CIB) was questioned over inconsistencies in its accounts.
“I told them they must fix it. In September 2008 matters came to a head and things became heated,” he said.
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