Showing posts with label Banco Espirito. Show all posts
Showing posts with label Banco Espirito. Show all posts

Wednesday, June 3, 2009

Tramp After Hours: Banco Espirito v. BDO Round 1

Duped Bank vs. Negligent CPA's. Round 1.

Much like Rocky vs. Drago, the life of BDO (Rocky?) may be on the line. Tramp will act as a ringside judge. Enter the lawyers:

For Banco Espirito, it's fundamentals: "'BDO International was grossly negligent,' said Steven Thomas, an attorney for Banco Espirito Santo. 'They were supposed to make sure their BDO firm here in Miami was doing its job.'''

BDO counsel took a different approach: '''Confusion creeps in because of the similarity in names,' Mark Raymond, a lawyer for Belgium-based BDO International, told jurors."

He continues: '''Like a wedding planner, they coordinate, they facilitate,' Raymond said. 'Does a bride give the wedding planner all of these rights to run and control everything? Of course not.'"

Round goes to: BDO - We are talking about a south Florida jury here. Most of the jurors are probably old with Medicare-funded hearing aids so confusion is a given.

Plus, all the fundamentalist Christians and religious Jews down there do love themselves some weddings and they all know that the wedding coordinator is NOT in charge.

The other poss is that jurors are alcoholics/addicts too fucked up to pay attention because they lost their ass on the beachside condos.

Hypothetical exchange during jury selection:

Potential Juror (on cell phone in slurring speech): You promised me they would sell! You fucking promised me!

Judge:
Ahem!

Potential Juror: Excuse me? Oh, sorry. No, I don't have any idea what a global network of accounting firms is.

Defense Counsel:
I have no problem with this juror, your honor.

Well played counselor. Updates will continue.

Banco Espirito Santo wants firm held liable for jury verdict
[Miami Herald] Sphere: Related Content

Tuesday, June 2, 2009

In this Corner...BDO Seidman

It's more like a welterweight match but anyhoo...Opening statements were scheduled to be given in Banco Espirito v. BDO International in Miami today.

For those needing a refresher, BDO has been ordered to pay $521M to Banco Espirito after the Portuguese bank got duped out of $170M by the factoring (sketchy loans) company E.S. Bankest. New York Times coverage here and re: The Auditors here.

A jury found BDO guilty of negligence, and the firm was ordered to pay compensatory damages of $170M and $351M in punitive. The awards could potentially put BDO out on its ass.

The issue in this case is to decide if the "local" firm was acting as an agent of the international firm. If so found, the entire international network of BDO firms may be found liable for the judgment found against BDO.

Ouch.

This has big implications for all international firms, most currently for PwC who might find itself in a similar sitch with Satyam

Stay tuned.

Fla. jury to decide if BDO International liable [WEAR ABC 3] Sphere: Related Content