Deloitte falsified documents to evade tax on Abramovich's wealth | Hacker News Reader

Deloitte falsified documents to evade tax on Abramovich's wealth

bbc.com

625 pointsBetelbuddy205 comments

> Deloitte Cyprus said it could not comment on the specific allegations because the documents were more than 20 years old and no longer accessible.

That's convenient.

Also, I received a similar response when inquiring about a financial account that had been overlooked (there are reasons, I'm not getting into it) for a couple of decades. "Can't help you. Too old for us to have records." Well, my records are printed documents. Why can't you tell me anything? Reminds me of when the USA government stole my money from a bank transfer claiming suspicion of whatever (my landlord had a Middle Eastern sounding name and it was the 2000s) and then said they had no record of it when I provided all the required documentation to recover it.

In both cases, unfortunately, I concluded that the odds are so stacked against me that I gave up. Convenient system if you're fabulously wealthy or a massive org (such as corporations and government).

2013 is not 20 years old so those documents should be readily available.

2003 is, though. Apologies if I missed anything but a quick ctrl-f on the articles didn't find anything for 2013.

If you click through to the IBJ investigation it states the backdating ran from 1999 to 2013. I don't know why the BBC only reported up to 2005.

I believe that almost zero wealth centers are scandal-free, and that some people collect the info badly, others do it very well, and there is an economy based on that alone. Enforcement is selective, intermediaries are constantly paid by various means, and time is on the side of many involved.

Picking on particular scandal to publicize is more like picking from large heaps of content in a collection, not anything unique or unusual at all.. just not widely known for real reasons...

Tax evasion is a game played by 100% of sophisticated players, to start IMHO

Most institutions (especially financial) have strict document retention policies to protect themselves from situations like this. It's not shady – just a way of limiting liability.

At my first job I made the mistake of discovering a cache of old documents, documents that were far older than the company's seven-year document retention policy. The cache, being my discovery, meant I became the one responsible for destroying it. It was dozens on dozes of bankers boxes filled with documents that I had to de-spine before shredding.

You would have thought that the process was a chore but for me it was exhilarating. The slowness of the process gave me the opportunity to speed read through it all. There was nothing scandalous in there, but I became somewhat of a historian over many quiet nights.

> It's not shady – just a way of limiting liability.

It's not euphemistic – just diplomatic phrasing.

"Its just how we commit crimes quietly"

Even in the year of 2026 not everyone is dumb enough to record themselves committing crimes and then brag about it online.

Organizations are not run by a single person. Imagine yourself as an investor into a large organization. Or you are invited to work as a CEO. You would definitely want to limit your own responsibility (in terms of financial losses or legal costs) when there are hundreds or thousands of people working together and anyone can make a mistake.

Of course you'd have compliance department to look over the processes to minimize the risk of mistakes and correct them ASAP (if you don't, you'd be liable for negligence and open yourself to a higher chance of failures). But since mistakes and miscommunication is inevitable anyway, you'd require hard limits in every obligation - in terms of time, money, scope etc.

Organizations that are not protecting themselves do not live long. And this principle has nothing to do with the nature of their activity.

Please, this is quite literally why the policies exist. If you want to change the world, you must first accept it for what it is

I wouldn't go that far. If it's a legal practice, it's a legal practice. I can understand why a company would want to limit their liability over something that happened seven years in the past, even when they are confident that their procedures are both rigorous and in compliance with the law.

On the whole, I would say the problem isn't so much using language to whitewash the practice as the troublesome tendency to turn a blind eye until someone becomes persona non grata.

Just because something is legal doesn't make it right or good for society.

Do you honestly expect all businesses to keep all records forever? Do you understand the costs and labor required to do this? No one does this.

In an age of exabytes, -yes-

Lol ok champ.

You can be sarcastic but there is no reason you've said why emails and documents of a few megabytes can't be permanently saved by companies using Exabytes of data. Make your point

Apparently it's way too hard and complicated for a multi-billion dollar enterprise to retain documents but quite easy to tell clients how to evade taxes.

What a fucked up world.

Understanding the intricacies of large enterprise data and all the forms it can take is an exercise left to the reader. It isn't simple and I'm not sure why anyone would think it is. There isn't just like, a single fileshare you have to monitor. There are many more numbers than just X amount of data.

In a world where I’ve had a dossier in some corporate database since Rapleaf in 2007, I’m completely unwilling to accept your opinion that basic document retention based on account id is more complicated than I’m assuming. edit: the only things that I can see motivating it's lack of existence is lack of law and the desire for greater profitability. nothing technical has prevented it

How many times has the company changed their archiving service? How many datacenters do they have? How many network shares? What about one drive? Local docs? Gsuite? Remote profile accounts on RDS servers? AS400 shares? What about CAD cloud docs? How many times has the email archiving service changed? Warm storage vs cold storage? How will that be managed? When does it go into read only state? How are you tracking document changes? What about SharePoint docs and lists? Do you need to save vm snapshots? And on and on.

You're talking like doing anything at a company is impossible when the company is only that large because they employ people to do many things. Everything on your list is just a job for a few people with some executive decisions. Maybe even just a list to feed into an LLM

Some of those decisions should just be forced by law.

No, I'm saying a limit on data retention time is an obvious thing.

Everything you listed, including the on and on, is immaterial to the point I'm making. You're just listing the costs of doing business. I'm not saying there are no challenges, especially given how history has unfolded. I'm saying that in a world where google has maintained a copy of my gmail account since 2004, its reasonable that we should have written into law "If you send an official communication to a customer you must maintain a record of that communication which can be obtained by request of the customer or customer's estate until the dissolution of the company (upon which the state government would take custody)", and if we had, along with all the downstream effects from implementing such a law, we would live in a better society. I'm not saying it wouldn't be expensive and potentially dangerous given how poor we are at data protection presently, but IMO it would be worth it compared to the shitshow we inhabit.

So a lawn maintenance company and Google should have the same data retention standards? It isn't free.

Who said anything like that? You seem to be jumping to conclusions rather than actually considering my point.

They downvoted him because he spoke the truth

Look, if you want better behavior lobby for longer retention, simple as that, laws will be passed if there is enough will behind. Or some centralized store, whatever. Eveeybody will align if things are clear and legally required by date xyz.

Dont blame any private company that its not overstepping its legal requirements and adding risks and costs to their business. Its like blaming a guy, any guy, heck all HN we dont pay more taxes than we have to pay, it goes to good things and is moral no?

We can do both, it's not hard to advocate for change while calling out bad actors as bad actors. Many companies openly degrade society while following the law. That still doesn't make it right. These are just excuses to allow authoritarians to degrade our lives and society unabated.

I don't think anyone is claiming that the destruction of evidence is right or good for society. On the other hand, do we really want to live in a world where everyone needs to be paperwork pack rats? One thing that I can assure you is requiring the retention of documents that provide evidence of a crime, while allowing for the destruction of everything else after seven years, wouldn't have the desired outcome. (Though it would be amusing to see which corporations have the largest indefinite data retention warehouses if it did work!)

I also think the right and good for society means addressing crimes in a timely manner, which likely means more auditing by independent bodies. Punishing someone for a crime that happened 7+ years ago may feel good, but it is meaningless for a couple of reasons. Should we be punishing people who have reformed? And for those who don't reform, should we be letting criminal behaviour occur across multiple decades?

Destroying evidence of a crime is itself a crime.

In most jurisdictions there are retention policies defined in law. Companies, like almost anyone else in the world, will do the bare minimum necessary to meet the legal requirements because it doesn’t make sense to do more. They only incur expenses while exposing themselves to all kinds of liability.

> It's not shady – just a way of limiting liability.

And storage costs.

> Most institutions (especially financial) have strict document retention policies to protect themselves from situations like this. It's not shady – just a way of limiting liability.

Yup. With every data breach, HN is full of (correct, imo) comments about how tech companies should treat private data as a liability and prune it aggressively.

You go look at mature businesses and you'll find that they do exactly this.

And less mature businesses that are in highly regulated industries, since they know nobody will fund them if they can’t prove they aren’t a legal timebomb. I’ve worked across clients in edtech, fintech, healthtech, aerospace, and in all of them making sure they didn’t die by regulation was present from early on. (Granted, places that don’t care about things like that don’t work with people like me.)

Edtech in particular tends to be pretty conscious of just never having the data in the first place. PII for minors is radioactive.

> I became somewhat of a historian over many quiet nights

Please step into the shredder, sir.

It's not personal–it's just policy.

Covering up for screwups so that they don't get in trouble is like the textbook definition of "shady"

Company finds 7 year old financial data in banker boxes: We're going to need a bigger shredder!

Company finds 7 year old customer records with PII, location data, etc..: We're going to need a bigger production hard drive!

Nope, they destroy digital records as well, at least banks do. If you ever work for a financial institution, you’ll have mandatory training about data retention timelines.

Oh, come on. HN complains about excessive data hoarding all the time. Now it's wrong to not hoard data? This is just another damned if you do, damned it you don't situation and, predictably, the outrage option is voted to the top.

Strong disagree. You want to keep track of how many times I go to the bathroom each day, and how much toilet paper I use each time? I complain about data hoarding. You're handling my money? You'd better not lose it, and you'd better keep accurate records, and you'd better keep them forever.

And in these specific cases, 20 years ago? They weren't handling stuff with computers 20 years ago? They didn't keep backups of that? (Another commenter notes a 10-year record keeping requirement in Europe, so in that case it may have legitimately been removed.)

But it's worse with the government. It wasn't 20 years ago, you just did it. And you don't have records? That's theft.

Why would you need to know anything about 20 years ago. In a sense financial data is even easier. There is a ledger and if you have kept 10 years of detailed history that is plenty.

Nice false equivalence.

Because the legal requirement is to keep those financial records for a maximum of 10 years? I'm sure it depends on jurisdiction, and the type of the document, but financial records generally 10 years in Europe.

What about financial accounts? I need to ping my accounts every X years or the company just keeps the money?

Depends on the jurisdiction. In the US, each state has escheatment[0] laws governing how untouched accounts are retired and how they may be subsequently claimed by their original owner. That process typically happens through a government agency rather than through the original company that held the account. But other parts of the world have other processes.

[0] https://en.wikipedia.org/wiki/Escheat#Transfer_agents_and_es...

That doesn't seem logically related (though that doesn't mean it legally isn't). If there's a statement from last year saying that the account has x amount of money in it, then that's a document within the 10 year retention even if the last deposit was more than 10 years ago, so there's still a record that the account exists.

Yes? What happens if you don’t ping in 20, 50, 100 years? At some point between 0 and infinity, it’s probably safe to assume you’re not coming back.

You can argue where to draw the line, but arguing that there shouldn’t be a line at all is absurd

Don't worry, if they think they can extract more money out of you, you can be sure they still keep the documents. Case in point my HSBC account which is officially closed since 2014 and they still try to contact me illegally.

There should be a limit. You can’t expect me to keep a client’s records for two decades. For software development, I think 2 years is reasonable. Many industries already have proper (and mandatory) limits, usually somewhere in the 3-7 year range depending on the field (finance tends to be higher) and the country. Some countries, especially developing ones, have no bookkeeping rules at all.

But after 2 decades for a financial account, I'd assume any recovery as a gift rather than a right.

The irony of these documents being (allegedly) backdated, and this response, is not lost on me.

public accounting firms are, as a rule, generally loaded with people who aren't that capable (there are exceptions for sure)

I doubt they even knew what was going on

turnover is also extremely high; only partners are going to be around that long. At this rate, many of those long-time partners are being forcibly retired to make way for the next gen.

Document retention policies are often constructed to require documents be discarded after a certain date.

Having a universal rule is about the only way to ensure decisions aren’t being made for other reasons and that they comply with your privacy standards.

If that account was truely forgotten about, there is no way it wasn't closed and simply sent to the relevant state Unclaimed Funds group of the state treasury where it waits to be claimed for quite indefinitely.

"when the USA government stole my money from a bank transfer claiming suspicion of whatever"

Details please! That is really interesting.

same reason why bank accounts are now getting closed for not being in 'use' now.

I have lost two bank accounts to these shenanigans cz I moved countries.

now I just view bank accounts as temporal - I have them for a period of time. & at a certain point in time in they disappear like snapchat photos.

20 years is a very long time. It's a good thing there's a limit: not to protect the fraudsters billionaires but to protect the little guys, like me, versus the basically limitless power of local IRSes/judges/etc.

In several EU countries the limit is about 6 to 7 years. Which coincides with what many banks allow to go back in time to fetch the statements (at least without additional costs).

I think that is fair. The question though is: why are my taxpayers dollars paying for incompetent public servants that only realize more than 20 years after the facts that documents were falsified? I don't want my public servants to be crybabies after they fucked up: instead I want them to discover fraudsters in a reasonable timeframe.

Deloitte has got, I've heard (!), in their training material a section about integrity and how important it is to act ethically correct. Deloitte also does sh*t like this and - again, I've heard (!) - asks its employees to bill hours on projects they are not working on so that they can maximize profits at their clients expenses. Also elephants are pink.

How this company can proceed to exist is beyond me.

For legal reasons I must emphasize that this is hear-say and should not be trusted as facts. At least one statement is a lie. What you believe to be true is up to you.

Standard corporate nonsense. Enron famously had integrity plastered across it's corporate walls as it's values when they got done for fraud.

Sounds like every other corporation in America?

Deloitte, for the record, is a multinational based in London.

Sounds like every other multinational based in London.

Its a bit more complex. its a network of national firms, and each member firm is a separate legal entity. in this case it was the Cypriot member firm.

From the footer on (the Uk section) of their website:

> Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms, and their related entities (collectively, the “Deloitte organisation”). DTTL (also referred to as “Deloitte Global”) and each of its member firms and related entities are legally separate and independent entities, which cannot obligate or bind each other in respect of third parties.

Who is deciding compensation/hiring/terminations? Are there separate leaders in each nation independent of the others?

Deloitte employees, former as well as current, are not allowed to share details about hiring process, management structure or compensation schemes. Enjoy.

*cringes in multiple ways*

Deloitte is a global network of partnerships, which has a corporate structure with liability rules that are different from a regular corporation.

You can read more about it: https://en.wikipedia.org/wiki/Deloitte#Legal_structure

Yes, that link was trivial to find. But it does not expound on how the decision making process works. Each nation’s Deloitte organization is presumably able to avoid blame for actions done in any other nation, so the question is are they all operated completely independently? Is there no hierarchy above the national level?

This should help you get a better picture: https://en.wikipedia.org/wiki/Professional_services_network

Yes, there are. Each is run independently.

This is fairly typical for accountancy and law firms.

More explanation here: https://en.wikipedia.org/wiki/Professional_services_networks

WTF - I am being downvoted for explaining this above? Pure facts!

"Well, ackshually...."

Which changes nothing about the GP's incorrect assertion.

> How this company can proceed to exist is beyond me.

Isn't the whole point of these companies to rubberstamp shady things corporations are doing, so they can shed resposibility more easily when caught?

Not only. They are also used when a CEO wants to do something and needs someone to produce evidence supporting what the CEO already wanted to do.

They also exist to transfer wealth to workers with the right pedigree (much like the tech industry for many years). If you go to the right school, but graduate without actually being able to do anything, you apply to a consultancy. You'll at least make enough to afford your apartment and groceries while you make the connections to get paid 6-7 figures doing nothing someplace else.

They had me watch some nonsense on integrity as part of the training.

All the while we were doing financial regulation software without any proper tests on the models being done outside of some spot checks.

And the idea of doing those was frowned upon :)

Lovely place.

Amazing. Simply amazing. I also loved the one that allegedly says that you can't publicly criticise the leadership structure. Allegedly.

KPMG, E&Y, PWC, they're all the same because they have to compete with each other's dishonesty in order to both maximise profits and maximise cough tax savings cough for their customers.

There have been a couple of scandals in Australia, and yet they all remain part of 'the big four'. They're all tainted as fuck.

I see their work product with some regularity. To say I'm not impressed would be a severe understatement and I really don't understand why companies keep hiring them.

I think the article explains why.

They did a 'cloud strategy' for a previous client. There was a 'partner', numerous 'consultants', 7 figures US$ AFAIK.

It was mostly regurgitating the AWS published best practices on Deloitte letterhead. We all grumbled how "this was not a good use of money", but one of the senior folks from the line of business side said "you guys were going to basically do this anyway...now noone can say you picked the wrong strategy". Which, to be fair, was true.

So that's probably why companies keep hiring them.

Yes they're basically glorified "insurance" for the c suite

I wasn't exactly c-suite in that engagement; it provided air-cover up and down the CoC. But yeah, I get your point.

It's also a great "telephone" between the low-ranks and the C-suite if the comms are broken on a company.

meaning: If your boss won't bother to ask it's own employees or trust their feedback, he might choose a well kept, well presented third party to gather that feedback from their employees, and then package it nicely with some cool logos and slides and decks, and charge you a shit ton of money out of it.

For what it’s worth, I’m not so sure there’s much of a difference in delivered value between the hours truthfully billed vs. fraudulently billed

> about integrity and how important it is to act ethically correct

There's also a fine print at the bottom that says 'lolz'.

I'm sure the seniors had a blast producing that material. "...and then I told them - get this (*wheezes between laughs*) - we have to be honest ! Hah!"

Allegedly.

Don't open yourself up to charges of hilarity.

Deloitte operates much more like a franchise network than a single multinational corporation. It's technically a network of independent, locally owned professional-services partnerships.

This one appears to be Cyprus - clearly the center of ethical business operations...

Is this a different structure from other large multinational consulting groups?

No, all big 4 are franchises.

But MBB is different.

“Sorry, we can’t help you. Let me introduce you to my colleague from Cyprus who can...”

"How this company can proceed to exist is beyond me."

https://www.youtube.com/watch?v=Gxd23UVID7k&list=RDGxd23UVID...

> How this company can proceed to exist is beyond me.

How can they not proceed. They are making money doing nothing and have no moral boundaries. And now we find out they have no legal boundaries either.

Most corporations probably have those. They also have similar training about security, and yet. Software corporations have similar training about software engineering practices, and yet.

Every bank has exactly same stuff. Any new scandal adds another 1..X mandatory trainings for much of / all staff, usually quaterly recurring ones.

Things like escalate problems to correct teams, even where to (supposedly anonymously) whistleblow, but thats most probably 1 way ticket to unemployment office with a sife effect of appearing on some industry-wide even if local blacklist.

They are so predicrable I dont read accompanying materials anymore and usually just 1-shot final tests, maybe apart from stuff that I never touched nor heard of, that sometimes requires second go.

To sum it up - those trainings are not ultimate business guidelines. The more they veer on what to do in case of something bad/spicy happens, the more they are some court ordered result of some long legal battle and settlement&fine.

I worked for Siemens, which was fined for bribing foreign officials to secure orders (which was undoubtedly SOP for all businesses in those countries, but Siemens got caught).

As a result of Siemen's execs bribing various Nigerian princes et al, new employees at the lowest levels were required to take training to teach them that bribing government officials is Bad, mmkay?

The execs did not do time, and AFAIK were not fired. But the secretaries now know they shouldn't do that!

The goal is not to train you, but to limit their liability. They can say they have a track record of ethical training, and then off the track have incentives to do unethical stuff.

To be fair, this is Deloitte Cyprus. Not that other partnerships wouldn’t do the same, but one that is set up in a renowned tax haven is likely to come across some interesting work.

My hot take is that we should have broken windows policing for white collar crime.

I"m sure you're not taking corporate CYA training at face value are you? They do these trainings so they can have some liability coverage despite the fact that they hire people to explicitly do these unethical things. Then when shit goes sideways they can say this isn't our culture or policy and point to the training. We provided training against these actions. Limited liability means zero accountability.

> Also elephants are pink.

What does this expression mean in this context?

Cyprus and Deloitte, why am I not surprised to see those names mentioned together in connection with alleged tax evasion?

For those who don't know, Cyprus is widely regarded as one of Europe's tax havens. And, of cause, Deloitte has offices there.

They have dozens of offices in the UK and Germany, 13 in Netherlands, …

It hardly seems surprising (nor damning) to have one in Cyprus.

I wonder why Abramovich chose that office, some historical link to Cyprus no one has heard of?

Cyprus deliberately set out to make itself attractive to wealthy Russians in the 2000s and 2010s.

Various controversies relating to bailouts after the financial crisis, the rise of anti money laundering controls in the late 2010s, and the Ukraine invasion have severed many of the ties but Abramovich was just one of many to take advantage in the past.

https://www.politico.eu/article/cyprus-is-losing-its-russia-... has a reasonable summary of how the relationship developed.

You might learn how tax havens work. Those of us familiar all went "Cyprus...shocker /s".

Deloitte Cyprus is a separate legal entity from all the other (separate, legal) Deloitte entities precisely so any consequences of tax evasion resulting from the...em...lax oversight in Cyprus don't impact all the other things called 'Deloitte'.

This isn't unique to Cyprus. Deloitte Global is specifically structured this way:

"The member firms are primarily organised on an individual country or regional basis and each operates within the legal and regulatory framework of its particular jurisdiction(s). They are separate and independent firms that have come together to practise under a common brand and shared methodologies, client service standards and other professional protocols and guidelines."

https://www.deloitte.com/ce/en/about/governance/network-bran...

I think they would have done this type of structuring anyway just because of what the parent comments have mentioned. But this is probably required by local laws just to be allowed to operate in the jurisdiction(s).

I'd be shocked if many EU nations required domestic incorporation just to do legal/regulatory/consulting business there. Plenty of other multinational corps operate under their primary company.

But it could be the case!

What I suspect happened with Deloitte specifically is they found a way to appear to expand globally without taking on a lot of the risk. More like brand franchising.

Which is all to say that I wouldn't doubt Deloitte Cyprus (or other branches) have shady stuff going on, but that this structure wasn't designed specifically for that purpose.

It is literally impossible to operate in any other way. We call them multinational but they just own the child company or the brand. If you operate at any country, your "parent" is irrelevant.

A while back there was a simple scheme available that allowed you to avoid taxes on the first few hundred thousand / million of taxes.

- You created an LLC in Cyprus and transferred some IP (usually a trademark) to it

- You licensed that IP to your LLC in an EU country for the amount that basically erased any profit that LLC made

- Cypriot LLCs were not taxed on non-Cyprus income

- Each of non-resident director (or board member, I don't remember) of a Cypriot LLC was not taxed on first 400k euro of income from those LLCs. Double taxation deals Cyprus had protected you from being taxed on that income back home.

I know this is no longer possible with Cyprus, but a variation of that is now happening with e.g. many EU clothing brands having their brand ownership transferred to Egyptian LLCs.

isn't this similar to what Apple and others are doing in Ireland?

It is a similar mechanism, but there were major differences:

1. It was usable for small-medium companies, because the amount you avoided taxes on was 400k euro times number of people you involved in the scheme as board members.

2. It avoided taxation entirely and not just shifted tax burden to the country with lower rates.

3. It allowed the money to immediately return to the country where the profit originated in without any tax consequences. There is a reason why tech giants are sitting on a lot of cash.

I don’t think this is possible under the latest rules, especially in the EU. But a small firm could easily get bad advice and think it’s outsmarting the system. Right now in the EU, it’s either pay or leave completely.

It definitely is no longer possible, which is why I used past tense.

This scheme was unique, because it was available to small fish allowing nullify taxes on the first 400k euro of income (or multiple if you got more people to help you).

Similar ones, available to large corporations, are very much still possible, but they are getting more and more pushback.

I dunno. This all implies a level of central control that doesn't reflect how professional services firms operate. Mostly they're loose partnerships and local offices and partners have the significant discretion. Even legally they're mostly not structured as a global corporation but rather a loose association of legally distinct entities.

There's a tension between having a brand that reflects trust and institutional rigor and avoiding liability for the actions of partners in some far flung jurisdiction.

I just know this will be thoroughly investigated, all responsible parties held accountable, and the proper countermeasures and applicable laws will be updated to punish and disincentivise this behaviour in the future. Just kidding.

Things change when the cost-benefit analysis moves. If you apply the law strictly and effectively, the behaviour will adjust.

I think you’re framing this at the wrong level: the cost-benefit analysis needs to be vs the rest of the rich world sanctioning Cyprus. It’s far from clear that it’s currently in Cyprus’s best interests to see heads roll for this, and so the rest of Europe needs to grow some balls for enforcement.

The cost-benefit analysis will move rather quickly if you add jail time into the calculation. If the penalty is a fine, you’ll see that just as a normal business risk.

This publicity is probably an actual advertising campaign for them.

"Welcome to money laundering services. If you're a billionaire, press 1. For tax evasion services, press 2. If you're a commoner, fuck off right now".

I read way too much of the comments before realizing this is not about Marina Abramovich hiding her gains from performance art in Cyprus...

Repeat offenders?

Sanction Deloitte Cyprus: don't ever except any paperwork from them again. "Sovereign state", my ass...

I think we should except all paperwork from them while not accepting any of it.

And that's without even getting into what to expect from them

This article, possibly deliberately because you can read the subtext of exactly what happened with this story, conflates several things knowing that readers won't know the difference.

Transferring assets from Cyprus to BVI? Legal, there is no issue with doing this. What the journalist did, likely upon discovering this was legal, suggested that it was for tax purposes knowing that readers would assume this was illegal in some way...when it is not relevant.

An opinion was then acquired from a KC which, to a normal person, would read as confirmation that something suspect was going on but, if you have experience with this thing, says that in a completely different, unrelated context this would be illegal (it is a bit sad that we live in a world where a journalist will get an opinion from a KC and they will both conspire to produce something that is obviously intended to be misleading to readers).

Backdating asset transfer from Cyprus to BVI? Again, legal. The role of an auditor is not to provide advice on the legality of the transfer. All that happens is that they get some paperwork saying the assets were transferred two years ago, they go...yes, the paperwork is correct. If you think they should be doing anything else, you don't understand what an auditor is supposed to do.

What would be more questionable is if the transfer didn't actually happen two years ago but the auditor would have no way to know if that was the case. This would be easy to determine in other cases but in the case of personal property, there is no way to know.

What likely happened with the story though is that the journalist put in a lot of time, realised at some point that they didn't actually have any evidence (implicating the people they wished to implicate) so wrote the story that Deloitte were to blame. Will be quite interesting to see what happens next because at several points in the article the journalist uses words that do not describe the role of an auditor i.e. Deloitte was "advising on the falsification of records"...when they show an email which clearly shows that Deloitte did not do this (and again, generally, this is not what an auditor is supposed to be doing).

I'm not able to see the article - for some reason, the Beebs, a division of the British government, wants me to subscribe to see their coverage - but how would this compare to Arthur Anderson and Enron?

If it's anything remotely similar, I don't see how Deloitte could be trusted to file one more tax return.

The Big Four really like back-dating things to help their clients. But lying is difficult because the facts come with built-in consistency. Mother Nature ensures all her arithmetic lines up properly every single time like clockwork, but when you try to make stuff up you have to do all that work and not make any mistakes.

And so it's actually easier to spot this fraud than to conduct it. What you need is people willing to go look and people willing to prosecute it even though that's uncomfortable because these crooks always have powerful friends.

Ultimately the bigger problem is the Big Four themselves. They are obviously Too Big To Fail and three of them are based in a single place, London. I believe that the Paris MOU provides us a model for how to fix this in the medium term but I've seen no political will to even look at the problem, much less address it.

And, nothing will happen. Did anything happen via Panama and Pandora paper leaks? Perhaps players with negligible political power to protect themselves were held accountable or selected by bigger fish to fall, but beyond those, nothing. The phenomenon is still happening and social collective action is continuously disrupted via no shortage of mechanisms. Wealth concentration is increasing and buying politicians was always a thing, but now it's publicly flaunted without recourse and they operate against what's good for the electorate interests openly--almost in spite.

I mean, the faltering ability to stir people to deal with Flock issue should be incredibly eye opening to what continuously slides under the radar for heinous activities that are not nearly as public facing or noticeably evident.

*Deloitte CYPRESS falsified documents... After Arthur Anderson went down for global issues, Deloitte split into country based things so when Deloitte Cypress has an issue they can hand wave away it being an issue regarding Deloitte in that country only.

It somewhat operates that way, too. Back when the little company I was at was acquired by Deloitte USA - I was exposed to some of the IT workings. Deloitte Canada did things their way, USA did things their way... no knowledge sharing, combined efforts, learnings/failings passing between the "different companies". Worst of both worlds. For tax and risk reasons.

Am I too cynical in reading this as an advertisement for Deloitte's services?

To be honest, my first thought too!

One would imagine you want your bankers doing just enough fraud and other illegal shit to build your money pile, just not enough of it to get caught.

I imagine most groups compete on exactly what they can get away with. The more money you can build for clients the more you can earn. If your competitor is getting away with more illegal shit than you then your clients will go to them.

It depends. How long is your yacht?

Not to be too forward, but whenever a company touches Cyprus we all know full well the only reasons are tax evasion or fraud.

> Deloitte Cyprus said it "acts in compliance with applicable laws".

They obviously haven't done anything wrong then.

The amount of dirt Deloitte has on governments, it is surprising something like this even came out. Likely someone will lose their job and the whole thing will be kicked in the long grass.

Damnatio memoriae https://en.wikipedia.org/wiki/Damnatio_memoriae

> Accounts signed off by Deloitte in Cyprus

That's all I need to know.

> Deloitte falsified documents

Isn't that their core business?

Do you want to have investments into London's real estate and football clubs or not? It takes sacrifices.

If this isn't sarcasm, then something is wrong. If investments can't be done legally, then no they should not invest.

Just for clarity, of course it is. I challenge everyone to list one positive thing which resulted from inflow of oligarch money into UK.

Presumably lots of taxes were collected and misspent.

It was one huge tax evasion mechanism and even purchasing tens of millions of pounds worth property was likely only a side effect of it. It even tickled the British pride a little for a moment because they were made to believe that someone appreciates their mansion architecture;)

Totally fine without them.

Also real estate prices in London at the top of the market are going down and down now that the money pump of corrupt Russian money has been switched off.

Somebody didn't follow the compliance training classes mandatory at Deloitte.

Check out the comments in r/soccer if interested -

https://old.reddit.com/r/soccer/comments/1x3vru3/deloitte_he...

Remove the "old" and replace with "www".

Reddit changed recently to deter AI scraping so that to use "old", you needed to log in sometime in the past 6 months. The "old" lets you see all the comments while the 'new improved version' only lets you read comments to a shallow depth while inserting ads everywhere.

This must be the first time someone important [0] has been involved in shady financial dealings. One of the joys of being in the internet era is we have much better visibility on the vast multinational web moving money around. We know that senior politicians are well aware of it because they use it to.

It would actually be reasonable if this was headline was news to Abramovich. I expect there are a bunch of standard services rendered to wealthy Russians and they just all use the same guy, who is known to get good results and no-one ever asks why. It is quite likely that there are a small group of fixers who maintain networks for certain geopolitical in-groups. They probably have excellent connections to people like Jeffery Epstein too. No surprise if the Russian circuit is actually flouting western law directly.

[0] https://en.wikipedia.org/wiki/List_of_people_named_in_the_Pa...

Wouldn't have happened if we used a blockchain.

It's not like we could also just have public access to these documents like some Nordic democracies so people could figure it out ahead of 20 years.

A classic story, as if there was nothing new

Wrist slapping in 3 .. 2 .. 1 ..

Something tells me the political ramifications here will be less than those of the next immigrant stealing a snickers.

Gentry crime no problem:)

The funniest part is that The Telegraph is simultaneously running articles on how the billionaires are leaving UK because of tax.

Why is that funny?

paying your taxes, if you can afford them is patriotic.

i miss being able to donate my liabilities away.

there's no way to absolve yourself from the murder machine anymore.

>paying your taxes, if you can afford them is patriotic.

The billionaire class made patriotism right-wing coded, thus dirty. They treat the borders as fluid as the millions of migrants they push through them.

What a joke. Meanwhile I'm selling shares and have have to give up almost 50% on numbers that are, quite literally, a drop in the ocean by comparison

I'd be less disgruntled about it if a) i feel like i got my money's worth and most importantly b) everyone paid their fair share

I know this is anecdotal but I remember anywhere you went in financial or political circles in 1990s London, everyone was falling over themselves about the nouveau riche from Russia and former Warsaw Pact countries investing. There were some who said it would drive up real estate prices and some upset about lack of oversight but they were looked at in the media and by politicians as kooky or close to it. Decades later - the Panama Papers, the Epstein files and articles like this and from that journalist killed in Malta exposing corruption.

Mind-boggling what people and corporations knew and did in the shadows while we cheered on and cheer on their holdings.

It took enormously corrupted and murderous personality to be nouveau riche from Russia and former Warsaw Pact countries during the 1990s. With links to former USSR security and intelligence agencies on top of it. People in most of these regions back then were eating mud pies.

who cheered on exactly?

Interesting that everybody is going after Deloitte, but why are we giving Abramovich, a known Russian oligarch and close personal friend of Putin a pass? Shouldn't we be more upset about Abramovich evading taxes? Isn't he and his lawyers more to blame because I would assume they're the ones telling Deloitte to do it?

Seems to me there's a lot of misplaced outrage here.

Well one is already disliked as an associate of an active war criminal. That's a given. Evading taxes probably falls low on his list of actual crimes.

The other we expect to oversee these kinds of things. Considering they do accounting for a quarter of the worlds rich and largest businesses, this should raise alarms as to what else they're fudging.

Am I the only one who can’t read the article because of the paywall? Since when does BBC paywall?

BREAKING NEWS: Water is wet

They (the billionaire class) all have no shame.

https://www.politico.com/magazine/story/2014/06/the-pitchfor...

I thought this article was a parody for the first few paragraphs... that's how times have changed, I guess.

I couldn't agree with the guy more, when he says:

>> when workers have more money, businesses have more customers—and need more employees

But that seems to be exactly the sane logic that old Jeff Bezos is spending his life and his billions trying to find a hack around. I'm still not clear who Amazon's customers will be if everyone's unemployed and AI and robots have taken all the middle class jobs... oppressive governments, I guess.

Great piece, and thanks for posting it.

Any individual business has contrary incentives to society as a whole. This is called a race to the bottom.

The article brings up Ford Motor Co. in the early 20th century as an argument for why this doesn't have to be the case. There have been other examples of businesses that care for their employees and society at large. The author is saying that that mentality needs to come back into fashion.

I think that this type of thought about strengthening the middle class is possibly the most dangerous and verboten to the people with a radical utopian worldview who are looking for revolution. In a sense, it's probably more important to attack this than it is to attack billionaires. Massive inequality is a much preferable state for would-be revolutionaries than a stable middle class with centrist political views. Which only reinforces the author's point.

I think it's maybe time to consider charging those responsible with treason.

Any kind of charge would make a nice change.

Treason by citizens of what country against what country?

> Deloitte is a multinational professional services network based in London, England.

https://en.wikipedia.org/wiki/Deloitte

Treason by British citizens against the British state. If you have to charge the CEO or board, so be it, there is a British citizen who is liable here.

Put them out of business. There need to be consequences. The Big 4 auditors need to be severely humbled.

Allegations, there was no trial or verdict.

An article like like this could be auto-generated with anybody's name.

Deloitte didn't deny it. The only possible interpretation of their statement is that they absolutely did do it, but they believe they can get away with it. Otherwise you'd just say "Deloitte doesn't falsify documents"

Deloitte can't deny because the allegations concern stuff way outside of their document retention policies.

I get this is an unpopular opinion, but it’s even more important given the nature of the allegations. They “look bad” but it’s all accounting stuff in Cyprus, none of us know what’s actually legal here and what isn’t, it’s the BBC making insinuation about stuff to promote an investigative reports show or something they run.

I don’t want to defend anyone involved in the allegations, and don’t personally think they’re above shady business dealings, I just don’t like usual sensationalist “reporting” - essentially advertising like this and how people eat it up.

If you're a UK media outlet accusing a Big Four accounting firm and a Russian billionaire of tax fraud and you've got it wrong, you can bet there will be a case filed incredibly quickly in the High Court.

Remember when a major bank turned out to have laundered billions for Mexican drug cartels and was fined only millions?

People would go to prison for crimes like these, but somehow companies get only a slap on the wrist. Whenever a company commits serious, blatant crimes like these, everybody who knew about it and didn't blow the whistle should be considered an accomplice and go to prison. And if it's big enough, or part of the MO of that company, it should be fined the entire value of the company. Nationalise it. Stuff like this should not be tolerated.

$1.9 billion[0] is "only millions"?

[0] https://www.bbc.co.uk/news/business-20673466

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