Rihanna Sues Ex-accountants for Losing Millions

Rihanna Sues Ex-accountants for Losing Millions

Rihanna sued her former accountants Thursday, putting blame on them for tens of millions of dollars in losses due to shoddy bookkeeping and a failure to alert her to trim down expenses when a 2009 tour was losing money.

The lawsuit in federal court in Manhattan sought unspecified damages against New York-based Berdon LLP and two accountants.

The singer, suing under her real name, Robyn Fenty, alleged through her attorneys that the defendants drained tens of millions of dollars from revenues while she launched four national and international tours over a five-year period.

By the "Last Girl on Earth" tour in 2009, Rihanna learned that the tour had managed "significant net losses" despite robust revenues, though the defendants had managed to pocket 22 percent while paying Rihanna just 6 percent of the tour's total revenues, the lawsuit said.

The lawsuit alleged that the practice of paying itself commissions on revenues was not standard in the accounting and business management industry and created a clear conflict of interest.

Rihanna's lawyers also blamed the accounting firm for an ongoing IRS audit of her tax returns, saying she was forced to spend significant resources to correct errors resulting from negligence.

Since firing the firm and its accountants in September 2010, Rihanna's fortunes are significantly reversed, the lawsuit said. The "Loud" tour stretching from June 2011 to December 2011 produced a net profit equal to more than 40 percent of total tour revenues, it added.

According to the filed lawsuit, Rihanna hired the accountants in 2005 when she was sixteen years old at the start of her career. She alleged that they repeatedly breached their agreements, engaged in misconduct, paid themselves excessive commissions, created entities without regard to their effect on her taxes and failed to document revenue and expenses and implement a proper budget.

Posted by Kade Quinn on Friday July 06 2012, 3:07 AM EST. Ref: Yahoo. All trademarks acknowledged. Filed under Entertainment, Featured News. Comments and Trackbacks closed. Follow responses: RSS 2.0