07MOSCOW1028, GOR AGENCIES VISIT PWC MOSCOW OFFICE MARCH 9

WikiLeaks Link

To understand the justification used for the classification of each cable, please use this WikiSource article as reference.
Discussing cables
If you find meaningful or important information in a cable, please link directly to its unique reference number. Linking to a specific paragraph in the body of a cable is also possible by copying the appropriate link (to be found at theparagraph symbol).Please mark messages for social networking services like Twitter with the hash tags #cablegate and a hash containing the reference ID e.g. #07MOSCOW1028.
Reference ID Created Released Classification Origin
07MOSCOW1028 2007-03-12 13:22 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Moscow

VZCZCXYZ0013
PP RUEHWEB

DE RUEHMO #1028 0711322
ZNR UUUUU ZZH
P 121322Z MAR 07
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC PRIORITY 8145
INFO RUEHFT/AMCONSUL FRANKFURT PRIORITY 3233
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY

UNCLAS MOSCOW 001028 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
STATE FOR EUR/RUS, EB/CBA 
FRANKFURT FOR SUSAN STANLEY, BILL COTTER 
TREASURY FOR BAKER/GAERTNER 
NSC FOR KLECHESKI AND MCKIBBEN 
USDOC FOR 4231/IEP/EUR/JBROUGHER 
 
E.O. 12958: N/A 
TAGS: EFIN ECON RS
SUBJECT: GOR AGENCIES VISIT PWC MOSCOW OFFICE MARCH 9 
 
REF: A. MOSCOW 664 
     B. MOSCOW 466 
 
1. (SBU)  Some 50 Officials from the Interior Ministry's 
(MVD) Department of Economic Security and the Procuracy 
General spent the better part of Friday, March 9, in the 
Moscow office of PricewaterhouseCoopers (PWC) in connection 
with the two cases pending against the firm (reftels).  The 
MVD was on a search for documents related to the outstanding 
tax case against PWC, which involves accounting for 
expatriate salaries.  The Procuracy was looking for documents 
 relating to charges that PWC falsified its 2002-2004 audits 
of former oil giant Yukos. 
 
2. (SBU) The head of PWC's Russia operations, Mike Kubena 
(amcit, protect) described the MVD raid as a "disgrace." 
Some 45 MVD officers rifled through PWC's office for hours on 
Friday and treated PWC employees "shockingly."  They took 
with them a significant amount of documentation -- none of 
which Kubena judged to be relevant to the tax case against 
the firm.  The MVD continues to threaten to bring criminal 
charges, but has not done so as of today.  (Note: In November 
2006, PWC lost its final automatic appeal of its claim that 
its expatriate salary accounting was in keeping with Russian 
law and international practice, and PWC has paid the USD 14 
million tax authorities argued PWC had underpaid.) 
 
3. (SBU) Kubena said the Procuracy's visit to PWC, which 
happened concurrently, but nevertheless separately from the 
MVD raid, was more tempered, if not professional.  The team 
of 4-5 officials examined and removed documents relating to 
PWC's audits of Yukos in 2002-2004.  (Note: PWC had isolated 
and stored these documents more than two years ago in 
anticipation of such a request from the GOR, but had not been 
approached for them prior to March 9.)  As of the sending of 
this message, previously scheduled arbitration court hearings 
in this case had just begun. 
 
4. (SBU) Despite his obvious distress about the manner in 
which the MVD conducted itself in PWC's offices on Friday, 
Kubena urged continued restraint when discussing the firm's 
case in public.  "Not all the facts are clear yet," he told 
us, and better not to raise the public profile of the case in 
ways that could come back to hurt the prospects for a 
reasonable solution. 
BURNS

Wikileaks

Advertisements
Post a comment or leave a trackback: Trackback URL.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: