This story was highlighted in yesterday’s Monday news brief but it deserves its own spot […]
~ Updated includes statement from Grant Thornton International in final paragraph.
The South China Morning Post is reporting that former Grant Thornton partner, Gabriel Azedo was arrested in Spain, citing “people with knowledge of his detention.”
Gaby was on the lam for over year and has allegedly stolen HK$91 million (around USD$11.7 million) from those close to him, although one of his alleged victims doesn’t see this as a half glass full situation:
Yesterday one of his alleged creditors, racehorse owner Archie da Silva, said: “I don’t know whether to be happy or not. Just because he has been arrested doesn’t mean we will get our money back. It could be a very tedious process to get him back to Hong Kong.”
Arch’s concerns about bureaucratic nightmare that is extradition seem to be well-founded, as the article explains that getting Gaby back to Hong Kong really isn’t going to be easy:
“There is no bilateral agreement between Hong Kong and Spain but a transfer under multilateral treaties the two jurisdictions are signatories to, or under provisions in Spanish domestic law, are two areas that can be looked at,” the person said.
However, it is likely extradition could involve a lengthy legal and diplomatic process because Hong Kong has no Surrender of Fugitive Offenders Agreement with Spain.
Another officer linked to the case said: “It’s really up to Spanish authorities to decide whether to hand over the man to us. They could ignore our request as there is no legal obligation for them to hand over Azedo.”
We contacted Grant Thornton International to see if they wanted to comment but have yet to hear back. It goes without saying that this story is pretty strange/intriguing so, we’ll continue to follow the developments.
UPDATE, circa 10:45 am ET: A Grant Thornton International spokeswoman provided us with the following statement regarding the matter:
“We understand from media reports that Gabriel Azedo has been arrested in Spain and that he may be the subject of extradition proceedings to Hong Kong. He was a member of the global leadership board of Grant Thornton International until his dismissal in October 2009. Immediately following his disappearance, Ms. Angela Gardner, a close relative of Mr. Azedo, filed a lawsuit in Hong Kong against Grant Thornton International Ltd but this was subsequently dismissed by the Hong Kong court.
While the situation is highly regrettable for the individuals concerned, this is now a matter for them and for the Hong Kong courts.”
Accounting News Roundup: AIG Rolls Out Repayment Plan; Wal-Mart Names New CFO; IRS Files Lien Against Sharpton | 09.30.10
AIG to Convert Preferred Shares Into Common to Repay U.S. [Bloomberg]
“American International Group Inc. agreed with U.S. regulators to repay its bailout by converting the government’s holdings into common shares for sale, a step toward independence for the insurer whose near collapse two years ago threatened the global economy.
The U.S. Treasury Department will convert its preferred stake of about $49.1 billion for 1.66 billion shares of common stock and then sell the holdings in the open market, AIG said today in a statement. Common shareholders, who hold about 20 percent of the company, will have their stake dilut ent, the insurer said. Those investors will receive as many as 75 million warrants with a strike price of $45.”
Spain loses AAA status, stands firm on austerity [Reuters]
“Spain lost its final top-line debt rating on Thursday as the government sought backing from lawmakers for a budget it hopes will be austere enough to convince markets it can slash the deficit at a time of economic weakness.
Moody’s become the third and last rating agency to cut Spain out of the highest AAA category which has helped it finance its debt relatively cheaply. The one-notch cut had been expected and the agency said it hoped not to have to cut again soon, bolstering Spanish debt markets.
But the agency also said a poor growth outlook meant Madrid would have to take further steps to meet its deficit targets in years to come. The Bank of Spain said a sluggish recovery would slow further in the third quarter.”
IASB head knows all about cross-channel frictions [FT]
“In a decade spent overseeing international accounting standards, Sir David Tweedie has become an amateur student of French psychology.
The Scot has locked horns with France several times as head of the International Accounting Standards Board, the body that sets the International Financial Reporting Standards rules followed in the European Union and other countries.
His fascination for his adversary is such that he recently thrust into my hands an academic paper entitled “France and the ‘Anglo-Saxon’ Model: Contemporary and Historical Perspectives”. The article explores the hostility often felt in France towards the British and American way of doing business.”
McDonald’s May Drop Health Plan [WSJ]
“While many restaurants don’t offer health coverage, McDonald’s provides mini-med plans for workers at 10,500 U.S. locations, most of them franchised. A single worker can pay $14 a week for a plan that caps annual benefits at $2,000, or about $32 a week to get coverage up to $10,000 a year.
Last week, a senior McDonald’s official informed the Department of Health and Human Services that the restaurant chain’s insurer won’t meet a 2011 requirement to spend at least 80% to 85% of its premium revenue on medical care.”
Wal-Mart picks successor to longtime CFO [Reuters]
“Wal-Mart Stores Inc (WMT.N) named Charles Holley to succeed Chief Financial Officer Tom Schoewe, who will retire on November 30.
The world’s biggest retailer said on Wednesday that Schoewe, 57, will stay at Wal-Mart until January 31 to help with the transition.
Holley, 54, joined Wal-Mart in 1994 and is treasurer and executive vice president of finance.
Those credentials should make him a capable CFO, said Wall Street Strategies analyst Brian Sozzi, though Wall Street could view the transition negatively since it adds uncertainty.”
All We Are Saying Is Give Dick Fuld a Chance [Jonathan Weil/Bloomberg]
Names being floated to replace Larry Summers as the National Economic Council include Citigroup Chairman Dick Parsons and Xerox CEO Anne Mulcahy. Jonathan Weil sees where Obama is going with this:
“There’s much we can learn about the kind of person the president is looking for by studying these two contenders’ credentials. In addition to CEO chops, it seems Obama is seeking someone who also has served on the board of directors of at least one company that either had a massive accounting scandal, blew up so spectacularly that it threatened to take down the global financial system, or both.”
…and doesn’t think he’s aiming high enough. He has some of his own suggestions.
Sharpton faced with fresh tax woe [Tax Watchdog]
The Rev. owes around $538k to the IRS for 2009. His lawyer is a tad confused by the whole thing and says everything will paid up by Oct. 15th.
Meant to get this out there on Friday but you know how it is. Anyhoo, everyone’s favorite Bond-turned-Darrell Hammond impersonated celebrity, Sir Sean Connery is having a bit of tax trouble in the country now known as the World Cup champions:
Legendary James Bond actor Sean Connery is being investigated for alleged tax fraud involving the sale of two large tracts of land in Spain.
Investigators say a property firm linked to the 79-year-old actor failed to pay taxes after he and his second wife sold land they owned on the outskirts of Malaga, Spain
The fact that the Connerys haven’t been arrested and are merely celebrities being investigated because some real estate companies involved in some shady dealings should be enough evidence to indicate that celebrity news is waning in the dog days of summer. Dr. Henry Jones wasn’t quote in the Daily Mail’s story but we’re hopeful that, if asked, it would go more or less go like this:
Accounting News Roundup: Why Did Power Integrations Fire Their CFO?; Spain Making ‘Sweeping Austerity Measures’; GM May Want GMAC Back | 05.12.10
Power Integrations fires chief financial officer [AP]
Not to worry Power Integrations investors, Bill Roeschlein’s firing “was not related to financial statements or regulatory issues,” according to the company. However, he is currently the “subject of a felony domestic assault criminal complaint filed in Missouri,” which he denies and naturally he will “defend himself vigorously.” Unfortunately, that might cut into the job search.
Spain joins euro zone austerity bandwagon [Reuters]
Spain has agreed to “sweeping austerity measures,” cutting civil service pay 5% and freezing it for 2011. The country will also cut approximately 13,000 public sector jobs.
Minority Owner Sues Cuban, Calls Mavericks ‘Insolvent’ [NYT]
Ross Perot, Jr. is suing SEC target Mark Cuban, accusing him of turning the Dallas Mavericks into a financial catastrophe. The Times reports, “Perot is seeking damages, the naming of a receiver to take over the team and the appointment of a forensic accountant to investigate its finances. Perot said that Cuban’s actions had diminished the value of his investment in the team and violated his and other minority owners’ rights.”
Cuban, as you might expect, isn’t impressed with Charts Boy, Jr.’s loserness. He wrote in an email to the Dallas Morning News, “There is no risk of insolvency. Everyone always has been and will be paid on time. Being in business with Ross Perot is one of the worst experiences of my business life. He could care less about Mavs fans. He could care less about winning.”
Failed Bomber’s Resume Fail [FINS]
Faisal Shazad’s resumé sucks.
Is G.M. Looking to Buy Back GMAC? [AP]
Sources say that GM is interested in buying back GMAC (now known as Ally Financial) “so they can offer more competitive lease and loan deals.” The U.S. Government currently owns 56% of GMAC and 61% of GM, who plans to announce its first quarter earnings next week.