NMC Health administrator sues auditor Ernst & Young for $4 billion fraud
The administrator of NMC Health, founded by Indian billionnaire, BR Shetty, has taken preliminary steps towards legal action against NMC’s auditor, Ernst & Young, as it seeks to increase recoveries for creditors of the United Arab Emirates hospital group, a document showed on Friday.
NMC Health has been run by turnaround firm Alvarez & Marsal since going into administration in April after months of turmoil over its finances.
In a report on progress of the administration process, dated Nov. 6, Alvarez & Marsal said it was assessing whether actions could be taken against individuals and/or third parties to increase recoveries.
“We have interviewed and selected leading counsel to advise us in relation to potential actions and have initiated the legal process of making a claim against the company’s auditor, Ernst & Young LLP, by issuing a preliminary notice of potential claim,” Alvarez & Marsal said.
Ernst & Young confirmed to Reuters that it had received a preliminary notice to a letter of claim from the NMC Health administrators.
“It would be inappropriate to comment further,” it said.
NMC Health is the largest private healthcare provider in the UAE, operating more than 200 facilities including hospitals, clinics and pharmacies.
Its implosion this year amid allegations of fraud and the disclosure of more than $4 billion in hidden debt has left some UAE and overseas lenders with heavy losses and prompted legal battles to try to recover money owed.
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