Via Guardian/Allindstrom
Rihanna is suing her former accountants, accusing them of mismanaging her accounts between 2005 and 2010. The singer is seeking tens of millions of dollars in damages and lost revenue, claiming that Berdon LLP collected “exorbitant” commissions even as they bungled her taxes.
According to papers filed in a Manhattan federal court, between 2007 and 2010 Rihanna was paid just 6% of the total receipts from her Last Girl on Earth tour. Meanwhile, Berdon paid itself 23% of the total revenues – amounting to millions of pounds.
“Between 2005 and 2010,” her lawyers wrote, “[Rihanna’s touring company] suffered significant losses due to defendants’ financial mismanagement and other acts and omissions.” Because of Berdon’s incompetence, they allege, Rihanna’s 2009 world tour lost money.
Rihanna said she hired Berdon in 2005, when the 16-year-old Barbadian was releasing her first single, Pon de Replay. She was “a minor with a booming music career”, the filings say, with “no knowledge or understanding of financial matters whatsoever”. In addition to suing the company, two particular accountants are named in the suit: Michael Mitnick and Peter Gounis. Neither man still works for the firm.
In addition to the issue of their commission, Berdon LLPis accused of keeping incomplete records, losing track of royalties, and botching US and international tax filings. The IRS is auditing the pop singer, her representatives said, following three years of erroneous (and often overdue) tax submissions.
Berdon LLP, Mitnick and Gounis are accused of breach of contract, negligence, breach of fiduciary duty and unjust enrichment. The defendants have yet to respond to the claim.
The 24-year old singer has had a tough week – she lost her grandmother, Clara “Dolly” Braithwaite, to cancer on Sunday. Rihanna posted several tweets to mourn her, and the wake was held in New York City on Thursday.