Emirates Park

The former CEO of a thoroughbred horse breeding operation was suspected of systematic fraud involving unauthorised payments to phantom suppliers, causing around $13 million in losses for the company.

Background

Emirates Park is an Australian entity which operates a thoroughbred horse breeding and horse racing business. It is owned by a Dubai-based businessman.

The former CEO was suspected of setting up false supplier entities and systematically authorising millions of  dollars of payments to those false suppliers. It was alleged that he transferred the payments to companies he owned, and later used the money for personal financial gain.

How we helped

We were initially engaged to assist the Company review electronic evidence following suspicions raised during an audit process. This quickly led to a call for a full investigation, which utilised the full suite of our technology, investigative and forensic accounting skills to uncover the extent of the false payments and to analyse and clarify the facts.

Through our investigation, we were able to undertake an analysis of the funds and identify many instances of misappropriation.

Result

We identified that the former CEO had indeed set up false entities as suppliers, and authorised payments to those false suppliers totalling around $13 million.

In many instances, the payments had been processed by the company, and subsequently the bank, without the requisite approval of dual signatories.

Our reports were used in the negotiation of a settlement of a Civil matter relating to the processing of the cheques by the Company’s bank and ultimately led to a settlement. The NSW Police and NSW Director of Public Prosecutions also requested that our expert report be used for the prosecution of the former CEO in a Criminal trial.

A KordaMentha partner gave evidence at the Criminal trial before a jury. The CEO was found guilty on 14 charges and sentenced to a maximum of 12 years in prison, with a non-parole period of 7 years and 9 months. The Judge described his conduct as a “systematic, sustained fraudulent scheme” and ordered he pay back $750,000 in compensation to the Company (the maximum a Court could order).