Corporate fraud. Misconduct of the partners, tax evasion, assessment of damage to the shareholders’ interests.

We have been approached by foreign shareholders of a well-known chocolate factory of Company K, who, upon the results of an audit, became suspicious that their Russian partners were unscrupulous. The check revealed that top managers of the factory and Russian partners created a non-transparent business scheme in order to understate tax payments and offshore the profits. Thus, we revealed the use of inflated prices, selling part of the products for cash without being recorded in the accounts, creating a network of affiliated companies, selling products at unjustified discounts and other violations. Upon the results of our report with recommendations, the foreign partners sold their participation not willing to deal with these swindlers.