KPMG's had "oversight" but refused to act in the matter of 1MDB -Admissions made by KPMG and its lawyers Freshfield suggest that Anwar Ibrahim Malaysia mut now pursue KPMG international for damages

 by Ganesh Sahathevan 

First see this reported by Nic Fildes in Sydney and Stephen Foley in New York of the Financial Times about KPMG's latest scandal, this time in Australia:

After initially deciding not to investigate the allegations about its Australia business last year, KPMG International engaged lawyers at Freshfields to review its interactions with the whistleblower. The “magic circle” law firm endorsed the global headquarters’ position that it could not launch a probe because of a lack of information from the whistleblower. Freshfields also said in correspondence in September that responsibility for any disciplinary action sat with KPMG Australia and that KPMG International’s role was one of oversight, not control, according to people familiar with the exchanges.  KPMG International declined to comment on an individual whistleblower case, but said: “We treat seriously all reports received by the KPMG International hotline and take appropriate action. We encourage all colleagues to speak up if they see or hear anything they consider to be inappropriate.” It added: “KPMG firms have agreed to comply with standards and policies established by KPMG International, and KPMG International works with the firms to ensure compliance with them.

 

Then see this, quoting this writer, reported by Sarawak Report in 2015: 

Dear Mr Sahathevan

I refer to your email below addressed to Mr John Veihmeyer, Global Chairman, KPMG International Cooperative (KPMG International).

I am the General Counsel of KPMG International and am responding on behalf of Mr Veihmeyer.

KPMG International is a Swiss Cooperative. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to bind or obligate any member firm.

KPMG International does not have any relationship with, or connection to, 1MDB”.

Yours faithfully

Tom Wethered

Malaysians and others, who had assumed that accreditation by KPMG represented some form of guarantee of high standards; quality control; centralised monitoring and disciplinary process to ensure high standards of accountancy practice must therefore stand disappointed.

According to KPMG’s top legal eagle, theirs is a form of franchise that has its cake and eats it at the same time.

Name bearers get to carry the brand, but without any form of accountability whatsoever:

“nor does KPMG International have any such authority to bind or obligate any member firm” [Tom Wethered]

In 2015 KPMG did not admit, as it does now, that KPMG International’s role was one of oversight.

Given action taken by US Department Of Justice, KPMG could not then, as it is trying to do now, claim   that " it could not launch a probe because of a lack of information".

Anwar Ibrahim  of Malaysia mut now pursue KPMG international for damages,. 

END