Global accounting and consultancy firm EY has dropped its appeal against a judgment ordering it to pay $10.8m to a whistleblower who raised money laundering concerns.
In April 2020 the Hight Court ruled in favour of Amjad Rihan after he’d been forced out of EY having made allegations over the company’s activities in connection with organised crime laundering drug money from the UK via Dubai’s gold markets.
Rihan alleged that EY had helped to cover up a crime – the export to Dubai of gold bars that had been disguised as silver to avoid export limits on gold.
He welcomed EY’s decision to drop its appeal but said the company’s leadership should accept personal responsibility for its breaches of professional ethics.
“They need to see heads rolling at EY. It’s not satisfactory, when all this has happened, that everyone just stays in place,” he told the BBC.
Last April, High Court judge Timothy Kerr ruled that EY had helped conceal the results of Rihan’s audit into the business practices of EY client Kaloti. The firm, Rihan alleged, had paid billions of dollars in cash for gold without adequately checking its origin, and bought gold bars from Morocco coated in silver to avoid export restrictions. Precious metals had also been obtained from Sudan, the Democratic Republic of the Congo and Iran without due diligence.
Kerr’s 133-page ruling stated: “The EY organisation was supposed to have a written whistleblowing policy, though I have no evidence that it had one.”
Mark Otty, then EY managing partner for Europe, the Middle East and Africa (and now EY’s global emerging markets deputy chair), to whom Rihan had reported his concerns, was singled out by the April judgment. He sat on EY’s global executive and also gave evidence at the trial.
“He struck me as uninterested in questions of professional ethics. Although he is still part of the EY organisation, and although he expressed confidence soon after the claimant’s later resignation that EY would sue the claimant, the laptop he was using at the time was not preserved,” the judgment stated.
After dropping its appeal, EY issued a statement that read: “We remain disappointed by the trial judge’s decision and by the subsequent refusal of leave to appeal the underlying findings of fact, with which we firmly disagree.
“With such an impediment, we concluded that our appeal on the law, even if successful, no longer merited the time and resources involved.”