The accountancy firm PricewaterhouseCoopers (PwC) has been urged to show that it is not using its complex international structure to evade responsibility for assisting with “illicit financial flows and the undermining of sanctions”.
In an open letter to PwC, Dame Margaret Hodge, the veteran anti-corruption campaigner and Labour MP, raised concerns about the London-based firm’s role in successive investigations by the Guardian and other media organisations, including the Cyprus Confidential leaks published last month.
She questioned the alleged involvement of PwC Cyprus in attempting to transfer £1bn of shares in the tourism firm Tui, owned by the Russian steel magnate Alexei Mordashov, to his life partner.
The attempted transfer took place on the day Mordashov was placed under sanctions by the EU, leaked documents suggest. Cypriot police have launched a criminal investigation into the matter.
Hodge called on PwC to explain whether PwC Cyprus sought advice from the group’s head office in London, or any other part of the company, before trying to move the shares.
Analysis of the leaked Cyprus Confidential files suggested 39 clients PwC Cyprus had worked for were subsequently named on sanctions lists last year by the US, the UK, the EU or Ukraine.
“If these allegations prove to be true, it would underscore a troubling trend,” said Hodge, referring to previous investigations highlighting the role played by PwC branches in the Luanda Leaks, Pandora Papers and a scandal at PwC Australia.
She said PwC had consistently argued that these were isolated, localised incidents carried out by individual member firms that are separate legal entities within PwC’s global network.
But she raised concerns that this corporate structure may have allowed PwC to build a world-recognised brand while escaping responsibility as a “professional enabler, contributing to reputational laundering, illicit financial flows, and the undermining of sanctions efforts”.
“Considering PwC’s position as a global accounting firm, with a global governing board, there is an expectation that the organisation should be held accountable for the activities throughout the entirety of its network,” said Hodge.
“It is unacceptable that PwC is using its name as a prominent UK and global household brand while evading responsibility and disregarding applicable laws and regulations.”
Hodge called on the company to provide “comprehensive” information on what it was doing to investigate and rectify the issues she raised.
A spokesperson for PwC said: “Any allegation of non-compliance with applicable laws and regulations is taken very seriously, investigated and appropriate action is taken if necessary.”
