Commentary: When the Accountant Disappears

by Cesar Bacani, 12 December 2009

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Law and Compliance Management

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Gabriel Azedo Grant Thornton

When one thinks of leading citizens in Hong Kong, Gabriel Ricardo Dias-Azedo is one name that comes to mind. A former president of Club Lusitano, one of the city’s oldest and most respected private clubs, the 61-year-old accountant is a pillar of the city’s Portuguese and Macanese community.

He is also well known as the managing partner at international accounting firm Grant Thornton in Hong Kong and a senior member of the Hong Kong Institute of Certified Public Accountants and its disciplinary committee. Azedo is so well-regarded that he concurrently served on the global leadership board of Grant Thornton International, the non-profit, non-practicing international umbrella entity of the various Grant Thornton member accounting and consulting firms worldwide.

But then things began to unravel. Azedo inexplicably disappeared in October this year. Separated from his wife and living alone in Mid-Levels, one of Hong Kong’s posh neighbourhoods, he is said to have gone to Lisbon in Portugal, where the police reportedly last traced him, but has not been heard of since. There are rumours that he has gone to ground in Brazil.

Complaints against Azedo soon emerged. China Construction Bank went to court to recover a HK$3.48 million loan it extended to Azedo. Businesswoman Angela Rita Gardner, who is related to Azedo by marriage, also filed suit, alleging that Azedo defrauded her of HK$69.5 million.

A third complainant, prominent socialites Arthur Antonio Da Silva and his wife Betty, filed a writ not only against Azedo but also against Grant Thornton. The couple – they own legendary Hong Kong champion racehorse Silent Witness, winner of 17 consecutive races – are seeking the return of assets in their daughter’s trust fund, which had been entrusted to Azedo and, they believe, to Grant Thornton.

In the Dock

This is where the misconduct of one individual threatens to tarnish the reputation of an entire accounting firm. Because Azedo is such a prominent figure in Hong Kong, in the accounting profession and his firm, his alleged transgressions are reflecting badly on Grant Thornton.

“Gabriel Azedo ceased to be a partner of Grant Thornton on 1 April 2008,” the accounting firm said in a statement. (He had retired last year upon reaching the age of 60.) In October this year, Grant Thornton International also removed Azedo from its global leadership board, where he had been advising on the accounting firm’s expansion into China.

“The claims of Mr. & Mrs. Da Silva have been referred to our solicitors and we shall file our defence in court accordingly,” the media statement continued. It noted that “Grant Thornton does not provide trust services nor hold assets on behalf of clients.”

The accounting firm indicates that its retired managing partner may have done something wrong. “Grant Thornton has been investigating certain matters concerning Gabriel Azedo’s personal conduct and has discovered that he appears to have used the Grant Thornton name in an unauthorised and inappropriate manner,” the statement said. “Because of the serious nature of the matter, Grant Thornton reported Gabriel Azedo’s conduct to the relevant authorities on 20 October 2009.”

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