Source: FOOTYMAD
Tom Hicks' company accused of fraud
A company controlled by Liverpool FC's former co-owner Tom Hicks has been accused of fraud in US court papers. Global accountancy firm KPMG is being sued by a finance company for giving a ‘clean bill of health’ to Tom Hicks’s American sports group which owned the Dallas Stars hockey team and Texas Rangers baseball team a year before it defaulted on a $540m credit line in March 2009. KMPG is accused by New York-based GSP Finance of assisting Hicks Sports Group (HSG) in hiding the true position of the company’s finances. “KPMG substantially assisted Hicks Sports’ fraud by certifying that its consolidated financial statements ‘present fairly, in all material respects, the financial position of [Hicks Sports] and subsidiaries... and the results of their operations and their cash flows... in conformity with US generally accepted accounting principles,’” the claim form asserts. In court papers lodged in New York, GSP says that had KPMG done its job properly the finance company would have been able to take action to recover $67m it loaned HSG. The papers detail how Hicks’s company had made substantial losses in the years leading up to the Texan’s acquisition of Liverpool FC in 2007. The lawsuit says HSG suffered losses of $113m in 2002, $67.8m in 2003, and $95m in 2004. He then was forced to restructure his debts which culminated in a number of deals, and by late 2006 had a total credit facility of $540m to HSG through a variety of lenders. The financial affairs of HSG were not related to those of LFC.
