On the 1st of August, 2002, Business Times in Malaysia carried an article headed 'IBM buying PwC Consulting"
Business Times (Malaysia)
By Fazli Ibrahim
Date: Thursday, August 1 2002
COMPUTER and services giant International Business Machines (IBM) is
acquiring the consulting and technology services arm of accounting firm
PricewaterhouseCoopers (PwC) for US$3.5 billion (US$1 = RM3.80) in cash
IBM Global Services general manager for Asia Pacific Timothy
Shaughnessy told Business Times that PwC Consulting will be integrated
into IBM Global Services as a single unit by the end of September once
the acquisition is completed.
Announcing the completion of the sale on the 2nd of October, 2002:
"Samuel A. DiPiazza, Jr., chief executive officer of PricewaterhouseCoopers, said, "With the closing of this sale, PricewaterhouseCoopers effectively completes the reorganization we began more than two years ago, and fulfills our commitment to unleash the consulting unit from the regulatory restraints of our industry. Combining PwC Consulting with IBM fully achieves the goals we set for the separation and it provides clients and our professionals with greater opportunities and access to innovative solutions. We wish our former colleagues all the best."
Prior to these announcements, steps were taken to "fulfill" the Malaysian part of the global sale by PricewaterhouseCoopers Malaysia.
PricewaterhouseCoopers Consulting (East Asia) Sdn Bhd was renamed as PwC Consulting Malaysia Sdn Bhd (289801-A) on 20-11-2001, to be disposed off to IBM Corp. This happened while the real consulting arm of PwC in Malaysia, PricewaterhouseCoopers Consulting Sdn Bhd (464379-U), still remains under the ownership of the current Directors of PwC Malaysia.
Ms Chu Kum Yoon, a Company Secretary, was appointed a a Director in PwC Consulting Malaysia Sdn Bhd (289801-A).
Ms Chu Kum Yoon, has never played a role in the Consulting business of PwC. Her appointment, and that of Mr Foong Weng Chee were sham appointments.
Here is an AGM for Matsushita Berhad that she signed off on at that time.
As for Mr Foong Weng Chee, he was at that time, and still is, running his own accounting firm, Foong Weng Chee & Co.
The sale of the consulting business to IBM Corp., was to include all ongoing businesses, assets and liabilities. But in Malaysia, what has happened is that the ongoing businesses at that time, as well as the assets were sold as part of the company renamed as PwC Consulting Malaysia Sdn Bhd (289801-A), under sham Directors, while the contingent liabilities to the tune of several hundred million Ringgit were kept hidden in the real company that handled the consulting business, PricewaterhouseCoopers Consulting Sdn Bhd (464379-U).
PricewaterhouseCoopers Consulting Sdn Bhd (464379-U), is a company that still exists, and has the Executive Director of PwC Malaysia, Dato Johan Raslan, The MD of PwC Malaysia, Mr Chin Kwai Fatt, the Tax Partner of PwC Malaysia, Mr Koo Chuan Keat , and Senior Partner in PwC Malaysia, Mr Lee Tuck Heng as the Directors and/or shareholders till today.
How do you sell a company, but keep the contingent liabilities hidden and away from the sale? You cannot, so you sell another entity, with sham Directors, with the 'good parts' and keep the original entity parked away carrying all the contingent liabilities, and go on with business. It makes the sale incomplete, breaks the criteria set by regulators (SEC), defrauds creditors, and makes the audits done on the Buyer, IBM in Malaysia as well as globally, fraudulent, but no one will know right?
Wrong. Sooner or later, a grassroot movement like this will come along and keep shouting from the rooftops, like a good movement should.
What is Dr Coenie Van Beek, the Global Leader for Ethics and Business Conduct in PricewaterhouseCoopers going to do about this? And how long is it going to take for the good Doctor to do something?