How the tech industry has become a web of collusion and corruption playing with all the mafia from the world (Will be keeping updated!) with the complicity of accounting firms.
Since many years it has been obvious for many observers that tech industry doesn’t follow the rules of the legal free market as some other traditional industries. Some commentators have been pointing out their obscure structure and others commenting on the opacity of their networks.
Some have been showing their links with corrupted financial services, others with freemasonry (aristocracy), or firms specialized in money laundering from profits coming from the selling of drugs and weapons (IBM), lucrative benefits from tax avoidances (Panama papers). It is not clear yet which actor is the most prominent in the industry but most have benefited from actions drived by crimes and abuses, law’s infrigements or corruption digging the public deficit.
Investigations from watchdogs, journalists and researchers or practicionners as myself have lifted the veil on the practices of webs of corruption that raise mayor sums of money from dirty business as selling weapons to war countries (Syria and Yemen), proxenetism in western economies (US and Europe), children and women trafficking in Asia or Africa, of accounts’ hacking and scams.
You can resume all in one and single word : MAFIA.
And, if you are ignorant of these practices, don’t call it conspiracy.
As mentionned in previous blog posts, big companies who are the biggest investors in technology are raising benefits with illegal activities war, pornography and trafficking.
IBM and Google have been selling weapons and encryption technology to Syrian fighters from both sides and to Saudi Arabia.
War and surveillance are the main poles in business for companies specialized in security and encryption. These companies also get most of their profits from selling technologies and algorithms at western governments to spy on their citizens via programs of mass surveillance and to censure political opponents and business competitors.
Tech giants commonly raise profits from the business of pornography, pedo-pornography and children trafficking, one of the most lucrative business on the internet today, weapons and gold trafficking or spoliations.
The role of multinational professional services companies as today’s leaders in technology with activities for auditing and funding big corps and startups ecosystems and as global influencers, is to be questionned with tech clients as IBM and SAP investing in social health sectors (NHS), public transports services or aviation due to higher rates of corruption.
Deloitte, KPMG, Ernst & Young and PwC are regularly incriminated into scandals of corruption:
In 2017, the global firms Deloitte, KPMG, Ernst & Young and PwC, known as the big four, have been condemned by Italy’s antitrust authority to pay a fine of 66 millions of euros for “nullifying” the bidding process and “neutralising competition from outside the cartel”.
In 2017, a « number of material errors » in Mitie Group’s full-year accounts for 2015 and 2016 had led to an investigation of financial statement from 2015 to 2017 into Deloitte by an accounting watchdog.
In 2017 Deloitte, KPMG, SAP and PwC were implicated in the Steinhoff scandal, a global retail business company established in South Africa with interests in western Europe, that led workers to lost their funds after Johannesburg-listed Steinhoff’s shares collapsed last year after the company revealed the €6bn black hole in its accounts.
This practice is not new. Back in 2004, Deloitte has already been charged (in 2013) in the US, to a fine of 10 millions of dollars for misappropriations observed in 2004 and 2005 with the bank Standard Chartered. It has been proven that they changed their recommendations for procedures for money laundering and transferred confidential informations to the bank on two other clients.
Deloitte is also helping big corps as Amazon, Google, Starbucks, Apple or Microsoft to avoid taxes, using places as the Negresco, the luxury palace located in Nice French Côte d’Azur as a basement for recruiting customers.
In 2018, South Africa’s corporate registry has accused McKinsey, KPMG South Africa and the German software maker SAP of criminal breaches of company law. A spokesperson for the South African companies and intellectual property commission filed reports for criminal complaints against the three companies following an investigation linking each to allegations that the Guptas used a friendship with President Jacob Zuma to exert influence over state-owned firms.
By doing so, these global firms played a role in deciding of whom will be the political leaders and the policies in local governments, as it has been shown with the actions of KPMG South Africa that were detrimental to Pravin Gordhan, the popular leader to the benefits of Zuma, the corrupted dictator who was forced to resign in february.
More service providers and national companies are involved and tacitly play the game of crime.
They have been denying of their implications but the truth is cracking from every part and ready to explode. If the tech industry wants to be acknowledged as a decent field, corruption and collusion must be mercilessly eradicated. Big corps must also pay their taxes to allow companies to create more value and more jobs for tech workers.