PricewaterhouseCoopers pay Spain €37 million to save employees

ACCOUNTANCY firm PricewaterhouseCoopers (PwC) have paid the Spanish government over €37 million in order to save four of its former employees from lengthy prison terms.

The accused are all former senior executives, including ex-president Miguel Fernandez de Pinedo, who had all faced up to 14 years imprisonment for their roles in the allegedly fraudulent sale of the firm’s systems consultancy to IBM in 2002.

The four men have now been sentenced to symbolic three-to-six month sentences, which they will not be required to serve.

The case was opened in 2008 when the anti-corruption attorney general’s office accused former employees of PwC of having falsified a restructuring process in the aforementioned sale in order to receive tax relief benefits. A €21 million advance on the deal should also have been declared as income rather than being added to the company’s assets.

The four executives have maintained their innocence, claiming that the restructuring was real, legal, and completely transparent. They also insist that the matter should never have been raised in court, and that the taxation authorities were involved throughout.

In the end, however, they decided not to fight the case any further since it was seen to be damaging PwC’s image.

The €37 million payment consists of €17 million in unpaid tax, €11 million in interest and a €9 million fine.