Brooge Power traders file fraud grievance in opposition to Ernst & Younger

By Anna Hirtenstein

(Reuters) -Some shareholders in Brooge Power have filed a fraud grievance in america in opposition to Ernst & Younger, alleging the auditor did not determine fabricated revenues in two years of the oil storage agency’s annual stories.

The plaintiffs are Stephen Cannon, Bryant Edwards and Neil Richardson, who had been traders in a so-called particular goal acquisition firm (SPAC) that purchased Brooge in 2019, in line with the submitting with america District Court docket within the Southern District of New York.

The plaintiffs allege Brooge fabricated revenues amounting to tens of tens of millions of {dollars} and that Ernst & Younger’s audit of the corporate was fraudulent.

Ernst & Younger stated it’s unable to touch upon authorized proceedings. Brooge additionally didn’t reply to an e mail searching for remark.

Brooge agreed to a settlement with the U.S. Securities and Change Fee in 2023 over fraud prices, which concerned paying a $5 million penalty.

“The basic monetary image introduced by Brooge to plaintiffs was a fraud: in actual fact, Brooge fabricated between 30% and 80% of its 2018, 2019 and 2020 revenues,” the submitting stated.

“Brooge couldn’t have effectuated this scheme with out essential help from Ernst & Younger.”

Brooge, an oil-storage leasing firm based mostly within the United Arab Emirates’ Fujairah, was arrange in 2013 and counts Mohammed bin Khalifa, the eldest son of the earlier president of the UAE, amongst its shareholders.

Brooge’s shares closed at $1.585 on Tuesday, down from a peak of $12.99 in March 2020.

The board of Dubai-listed transport agency Gulf Navigation in September permitted an acquisition of corporations and belongings owned by Brooge, together with a capital enhance, in line with UAE state information company WAM.

Considered one of Brooge’s strains of enterprise was with Coral Power Pte. Ltd., in line with the submitting. Coral was later rebranded as 2Rivers and was sanctioned by Britain on Tuesday for allegedly taking part in a key function within the Russian oil commerce.