PricewaterhouseCoopers (PwC) has been fined $25 million and suspended from consulting for two years for aiding a Japanese bank in laundering money to terrorist states, the New York Post reports.
According to a settlement between PwC and New York officials, the Bank of Tokyo-Mistubishi was involved in illegal transactions with terrorist states like Iran, Sudan and Myanmar. PwC was helping the bank hide these transactions on a 2008 financial statement by making sure the language wouldn’t be noticed by regulators.
An unidentified PwC board member who is now a partner at the firm was main figure involved in the scandal.
The Bank of Tokyo-Mistubishi informed PwC in May 2008 that they needed to remove any information that revealed the money laundering to the terrorist states. PwC let the bank’s lawyers determine the appropriate language to do so, and then approved of it.
According to The New York Times, PwC claimed that the report of the Japanese bank they sent to states was “impartial.” But regulator Ben Lawsky accused PwC of “improperly altering” the report.
For instance, PwC initially wrote in their report that they gave instructions to water down the language so transactions to Iran, Sudan and others wouldn’t draw attention but after facing pressure from the Japanese bank, they removed those details in their report to state regulators.
The scandal came from a broader review of conflicts of interest in the consulting industry.
“We are continuing to find examples of improper influence and misconduct in the bank consulting industry,” Mr. Lawsky said in a statement to The New York Times.