Latest news with #NMCHealth
Yahoo
23-05-2025
- Business
- Yahoo
EY faces $2.7bn lawsuit over alleged audit failures
Auditing giant EY is being sued for approximately £2bn ($2.7bn) by the main shareholders of United Arab Emirates (UAE) hospital operator NMC Health, Reuters reported. The 12-week trial at the High Court in London on 19 May 2025, centres on allegations that EY's audits from 2012 to 2018 were negligent, failing to uncover significant unreported borrowing by NMC's main shareholders. NMC Health, was listed in London in 2012 and promoted to the FTSE 100 in 2017, collapsed in 2020 after revealing more than $4bn in hidden debt. Administrators Alvarez & Marsal, appointed after NMC's collapse, argue that EY, formerly Ernst & Young, provided unqualified audit opinions during the period, despite missing billions in undisclosed debt and guarantees. Simon Salzedo, the lawyer representing NMC's administrators, described EY's audits as 'among the most fundamentally flawed examples of big-firm auditing' seen in a UK courtroom. He acknowledged that a single incorrect audit opinion does not necessarily constitute negligence but argued that issuing seven consecutive flawed opinions was difficult to justify. EY, however, denied the allegations of negligence. The firm's lawyers contend that EY was a victim of a 'pervasive and collusive fraud' orchestrated by NMC's senior personnel, including its principal shareholders, who manipulated the company's accounts to conceal the fraud from auditors. They argued that NMC's case relies on expecting auditors to achieve the 'impossible' in detecting such deception. The lawsuit follows other recent criticisms of EY's auditing practices, including its work for collapsed travel firm Thomas Cook and German payments company Wirecard. The administrators are seeking damages of around £2bn plus interest, down from an earlier claim of up to £2.7bn, primarily linked to undisclosed financial guarantees. Separately, NMC has initiated legal action against its founder, BR Shetty, who denies any wrongdoing, as well as other parties in London, the UAE, and the US. Earlier in May 2025,, EY launched Integrated Finance Managed Services, a solution designed to expedite enterprise transformation by leveraging SAP S/4HANA Cloud. "EY faces $2.7bn lawsuit over alleged audit failures" was originally created and published by International Accounting Bulletin, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Sign in to access your portfolio
Yahoo
22-05-2025
- Business
- Yahoo
Man City sheikh was ‘shadow owner' of hospital tainted by fraud, claims EY
Manchester City owner Sheikh Mansour was 'effectively a shadow owner' of failed hospital operator NMC Health, EY has claimed. The Emirati royal had links to two Emirati businessmen accused of stealing billions from the former FTSE 100 company, the accountancy giant has alleged. It was claimed his connections to NMC Health saw it shielded from proper scrutiny, meaning banks ignored 'red flags' to lend billions to the London-listed healthcare giant before its 2020 collapse. EY made the claims in submissions to the High Court as it seeks to defend itself against a £2bn lawsuit brought forward by bankruptcy administrator Alvarez & Marsal. The 'big four' firm claims Sheikh Mansour bin Zayed Al Nahyan had close ties to two of NMC Health's top shareholders, Saeed and Khalifa bin Butti. They are accused of stealing billions from the healthcare company alongside BR Shetty, its founder. The three shareholders, who together owned two thirds of all shares in NMC Health, are accused of defrauding the company by borrowing more than $4bn (£3bn) worth of secret debt. Dr Shetty has instead claimed he was the victim of a wider fraud. The High Court subsequently froze Dr Shetty's assets in 2022, including a luxury London penthouse. EY claims fraudsters inside NMC Health used their links to Sheikh Mansour to secure loans from banks, who were willing to lend billions to the chain headquartered in Abu Dhabi because of the Emirati royal's 'name' and credibility. The accounting firm's submissions to the High Court say: 'The evidence ... suggests that Sheikh Mansour stood behind the Bin Buttis in some informal way, making him effectively a shadow owner of NMC.' Sheikh Mansour's links to NMC Health were 'well understood in the region,' EY's submissions add. It claimed that banks conducted due diligence with the 'lightest of touches' due to the credibility given to the company by the Emirati royal. NMC Health's lenders 'failed to take obvious steps to protect their own interests by conducting proper due diligence on the loans they were advancing to the NMC Group,' EY's submissions to the High Court say. Sheikh Mansour is a member of Abu Dhabi's royal family, and is currently the United Arab Emirate's vice president. The Emirati billionaire is also the owner of Manchester City Football Club. The accountancy giant says Alvarez & Marsal have also 'shied away' from pursuing the Bin Butti brothers, because of their links to Sheikh Mansour. EY's submissions to the High Court say: 'No serious attempt seems to have been made to pursue the money stolen by the Bin Buttis.' The claims come as EY is accused of 'extremely serious' failings in its audits of NMC Health that resulted in the accountancy giant allegedly missing one of the biggest frauds ever involving a London-listed company. Alvarez & Marsal claims EY's accountants 'never even opened the books' at NMC Health. EY said it was a 'principal target and victim' of the alleged fraud. Lawyers for the accountancy firm separately accused Abdul Rahman Basaddiq, the former head of EY's Abu Dhabi office, of having enabled the fraud. At a hearing on Wednesday, lawyers for EY told the High Court that Mr Basaddiq was 'plainly a fraudster'. The Bin Butti brothers did not respond to Telegraph requests for comment. Khalifa bin Butti told The Times in 2020 that 'any suggestion that I have been involved in wrongdoing is categorically rejected'. Abdul Rahman Basaddiq did not respond to requests for comment. An EY spokesman said: 'This was a complex, pervasive and collusive fraud, and responsibility for it lies squarely with its perpetrators, including NMC's owners, directors and the treasury and finance team. 'This case is without merit and the full extent of this unprecedented fraud – of which EY was one of the targets – will be exposed during the course of the trial.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
22-05-2025
- Business
- Telegraph
Man City sheikh was ‘shadow owner' of hospital tainted by fraud, claims EY
Manchester City owner Sheikh Mansour was 'effectively a shadow owner' of failed hospital operator NMC Health, EY has claimed. The Emirati royal had links to two Emirati businessmen accused of stealing billions from the former FTSE 100 company, the accountancy giant has alleged. It was claimed his connections to NMC Health saw it shielded from proper scrutiny, meaning banks ignored 'red flags' to lend billions to the London-listed healthcare giant before its 2020 collapse. EY made the claims in submissions to the High Court as it seeks to defend itself against a £2bn lawsuit brought forward by bankruptcy administrator Alvarez & Marsal. The 'big four' firm claims Sheikh Mansour bin Zayed Al Nahyan had close ties to two of NMC Health's top shareholders, Saeed and Khalifa bin Butti. They are accused of stealing billions from the healthcare company alongside BR Shetty, its founder. More than £3bn secret debt The three shareholders, who together owned two thirds of all shares in NMC Health, are accused of defrauding the company by borrowing more than $4bn (£3bn) worth of secret debt. Dr Shetty has instead claimed he was the victim of a wider fraud. The High Court subsequently froze Dr Shetty's assets in 2022, including a luxury London penthouse. EY claims fraudsters inside NMC Health used their links to Sheikh Mansour to secure loans from banks, who were willing to lend billions to the chain headquartered in Abu Dhabi because of the Emirati royal's 'name' and credibility. The accounting firm's submissions to the High Court say: 'The evidence ... suggests that Sheikh Mansour stood behind the Bin Buttis in some informal way, making him effectively a shadow owner of NMC.' Sheikh Mansour's links to NMC Health were 'well understood in the region,' EY's submissions add. It claimed that banks conducted due diligence with the 'lightest of touches' due to the credibility given to the company by the Emirati royal. NMC Health's lenders 'failed to take obvious steps to protect their own interests by conducting proper due diligence on the loans they were advancing to the NMC Group,' EY's submissions to the High Court say. Sheikh Mansour is a member of Abu Dhabi's royal family, and is currently the United Arab Emirate's vice president. The Emirati billionaire is also the owner of Manchester City Football Club. The accountancy giant says Alvarez & Marsal have also 'shied away' from pursuing the Bin Butti brothers, because of their links to Sheikh Mansour. EY's submissions to the High Court say: 'No serious attempt seems to have been made to pursue the money stolen by the Bin Buttis.' The claims come as EY is accused of 'extremely serious' failings in its audits of NMC Health that resulted in the accountancy giant allegedly missing one of the biggest frauds ever involving a London-listed company. Alvarez & Marsal claims EY's accountants 'never even opened the books' at NMC Health. EY said it was a 'principal target and victim' of the alleged fraud. Lawyers for the accountancy firm separately accused Abdul Rahman Basaddiq, the former head of EY's Abu Dhabi office, of having enabled the fraud. At a hearing on Wednesday, lawyers for EY told the High Court that Mr Basaddiq was 'plainly a fraudster'. The Bin Butti brothers did not respond to Telegraph requests for comment. Khalifa bin Butti told The Times in 2020 that 'any suggestion that I have been involved in wrongdoing is categorically rejected'. Abdul Rahman Basaddiq did not respond to requests for comment. An EY spokesman said: 'This was a complex, pervasive and collusive fraud, and responsibility for it lies squarely with its perpetrators, including NMC's owners, directors and the treasury and finance team. 'This case is without merit and the full extent of this unprecedented fraud – of which EY was one of the targets – will be exposed during the course of the trial.'
Yahoo
22-05-2025
- Business
- Yahoo
Man City sheikh was ‘shadow owner' of hospital tainted by fraud, claims EY
Manchester City owner Sheikh Mansour was 'effectively a shadow owner' of failed hospital operator NMC Health, EY has claimed. The Emirati royal had links to two Emirati businessmen accused of stealing billions from the former FTSE 100 company, the accountancy giant has alleged. It was claimed his connections to NMC Health saw it shielded from proper scrutiny, meaning banks ignored 'red flags' to lend billions to the London-listed healthcare giant before its 2020 collapse. EY made the claims in submissions to the High Court as it seeks to defend itself against a £2bn lawsuit brought forward by bankruptcy administrator Alvarez & Marsal. The 'big four' firm claims Sheikh Mansour bin Zayed Al Nahyan had close ties to two of NMC Health's top shareholders, Saeed and Khalifa bin Butti. They are accused of stealing billions from the healthcare company alongside BR Shetty, its founder. The three shareholders, who together owned two thirds of all shares in NMC Health, are accused of defrauding the company by borrowing more than $4bn (£3bn) worth of secret debt. Dr Shetty has instead claimed he was the victim of a wider fraud. The High Court subsequently froze Dr Shetty's assets in 2022, including a luxury London penthouse. EY claims fraudsters inside NMC Health used their links to Sheikh Mansour to secure loans from banks, who were willing to lend billions to the chain headquartered in Abu Dhabi because of the Emirati royal's 'name' and credibility. The accounting firm's submissions to the High Court say: 'The evidence ... suggests that Sheikh Mansour stood behind the Bin Buttis in some informal way, making him effectively a shadow owner of NMC.' Sheikh Mansour's links to NMC Health were 'well understood in the region,' EY's submissions add. It claimed that banks conducted due diligence with the 'lightest of touches' due to the credibility given to the company by the Emirati royal. NMC Health's lenders 'failed to take obvious steps to protect their own interests by conducting proper due diligence on the loans they were advancing to the NMC Group,' EY's submissions to the High Court say. Sheikh Mansour is a member of Abu Dhabi's royal family, and is currently the United Arab Emirate's vice president. The Emirati billionaire is also the owner of Manchester City Football Club. The accountancy giant says Alvarez & Marsal have also 'shied away' from pursuing the Bin Butti brothers, because of their links to Sheikh Mansour. EY's submissions to the High Court say: 'No serious attempt seems to have been made to pursue the money stolen by the Bin Buttis.' The claims come as EY is accused of 'extremely serious' failings in its audits of NMC Health that resulted in the accountancy giant allegedly missing one of the biggest frauds ever involving a London-listed company. Alvarez & Marsal claims EY's accountants 'never even opened the books' at NMC Health. EY said it was a 'principal target and victim' of the alleged fraud. Lawyers for the accountancy firm separately accused Abdul Rahman Basaddiq, the former head of EY's Abu Dhabi office, of having enabled the fraud. At a hearing on Wednesday, lawyers for EY told the High Court that Mr Basaddiq was 'plainly a fraudster'. The Bin Butti brothers did not respond to Telegraph requests for comment. Khalifa bin Butti told The Times in 2020 that 'any suggestion that I have been involved in wrongdoing is categorically rejected'. Abdul Rahman Basaddiq did not respond to requests for comment. An EY spokesman said: 'This was a complex, pervasive and collusive fraud, and responsibility for it lies squarely with its perpetrators, including NMC's owners, directors and the treasury and finance team. 'This case is without merit and the full extent of this unprecedented fraud – of which EY was one of the targets – will be exposed during the course of the trial.' Sign in to access your portfolio
Yahoo
21-05-2025
- Business
- Yahoo
EY ‘never even opened the books' in £2bn hospital ‘fraud'
EY has been accused of 'extremely serious' failings in its audit of failed hospital operator NMC Health. The 'big four' accountancy giant is battling claims that it failed to spot an alleged multibillion-pound fraud at the former FTSE 100 company, which was plunged into bankruptcy in 2020. Administrators at Alvarez & Marsal have since launched a £2bn lawsuit against EY in the High Court over claims that its shortcomings resulted in NMC's failure. In court documents released on Monday, EY is accused of allowing three of the company's biggest shareholders to steal billions of pounds. Lawyers have claimed that EY's accountants 'never even opened the books' during their time auditing NMC Health between 2012 and 2018. They argued: 'EY never gained access to the group's transaction-level records in a way that allowed them to be meaningfully audited, and did not identify the fact that a massive fraud was being committed by posting manipulated entries.' NMC Health was founded by Indian entrepreneur BR Shetty in 1974, who floated the business on the London Stock Exchange in 2012. At its peak, NMC Health owned 45 hospitals and 15 pharmacies throughout the UAE and Europe, including in the UK, Sweden and Latvia. However, the business collapsed after its three main backers, Dr Shetty, Khalifa bin Butti and Saeed bin Butti, allegedly extracted billions in cash. All three have denied wrongdoing. Dr Shetty has claimed he was a victim of a wider fraud. The High Court subsequently froze Dr Shetty's assets in 2022, including a luxury London penthouse. According to the court documents, management of NMC Health at the time put forward 'implausible and contradictory reasons' to prevent EY's auditors from accessing the company's accounts. EY's auditors instead relied on limited information about NMC Health's finances, obtained by 'looking at a single screen, over the shoulder of an NMC employee'. 'If EY … had obtained proper access to [NMC Health's] general ledgers, the fraud would have quickly become apparent,' the administrators have argued. 'The ledgers were littered with thousands of entries that had been manipulated and were on their face indicative of fraud, including the hidden borrowing.' US short seller Muddy Waters subsequently raised allegations of fraud in a report published in December 2019. Shares in NMC Health subsequently fell 32pc. The administrators have also accused EY's auditors of 'pulling the wool over the eyes' of the firm's own investigators by working to cover up their failures. EY has denied the claims and instead argued it was the 'principal target and victim' of the alleged fraud, and claims that the case is 'without merit'. 'Everyone to whom EY might realistically have turned for information about the finances of NMC was actually engaged in practising the wholesale deception of EY,' the firm has argued. EY has also accused the administrators of having 'shied away' from pursuing those who committed the alleged fraud, including the bin Butti brothers. Khalifa bin Butti said in 2020 that 'any suggestion that I have been involved in wrongdoing is categorically rejected', according to The Times. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
