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Deep Due Diligence

About the rubric: In series of publications we tell you more about diferent cases we worked on in our practice. The aim is to show the nature of our work, how we solved complicated issues and how we manage crises protecting the interests of our clients. We respect the privacy of those who trust us which is why we will not mention brands and names in tese publications.

TERAA-SS was contracted to prove the unsuitability of one of the individuals behind a hostile takeover attempt of the management of a major company group. This individual had a large business structure in the European Union that had remained entirely unexamined by the courts and regulators arbitrating the takeover bid. Due to the court’s time-constraints, TERRA-SS had a time-frame of only one week to prove misconduct on the part of the individual.

A full forensic analysis of the individual’s company structure was performed, and all of the subsidiaries, related entities and key players were mapped. Following this process, TERRA-SS identified several ‘red flags’ within the individual’s company structure, and launched operations to examine each of them for tax-related misconduct.

Following both in-depth remote research, and an on-the-ground examination of the premises and operations of one of the companies in the group, TERRA-SS found that the offices were essentially empty, and it became apparent that this entity was a shell company with no activity or operations, making it ineligible for the tax benefits that were likely being claimed by the company.

Furthermore, TERRA-SS identified a key witness with evidence of multiple fraud schemes throughout the subject’s companies, including carousel fraud in Cyprus. This witness was brought to the courts by TERRA-SS, and his testimony was accepted following a polygraph test.

Finally, TERRA-SS worked closely with a forensic accountancy expert, and showed that the company group’s ownership structure stood in direct contravention of several public statements made by the individual, and that there were large-scale European Union tax liabilities that were unaddressed by the individual.

TERRA-SS obtained legal opinions from two highly respected global law firms to support this assertion, and submitted all of the evidence to the court along with an affidavit from one of TERRA-SS’s directors.

Following this, the judge reversed his previous ruling and ordered the individual in question to answer all accusations, which he was unable to do.


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