Rihanna Sues Ex-Accountants Over Millions Lost

She accuses the New York-based firm of shoddy bookkeeping and making money at her expense.

Posted:
 
rihanna20taxes_robyn20beck20afp_400lh
Rihanna (Robyn Beck/AFP)

Rihanna has sued her former accountants, charging that they caused her to lose tens of millions of dollars because of shoddy bookkeeping, according to MSN. She further alleges that they failed to recommend that she trim expenses in 2009 when a tour was losing money, and for an ongoing audit by the Internal Revenue Service.

The lawsuit in federal court in Manhattan sought unspecified damages against New York-based Berdon LLP and two accountants. A Berdon spokeswoman said the company had no immediate comment.

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 of the tour's total revenues while paying Rihanna just 6 percent of revenues, the lawsuit said. It said Berdon's unusual accounting practice of paying itself a percentage of gross tour income as commissions left it no incentive to "counsel" Rihanna to reduce expenses or put in place appropriate financial controls.

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.

On their face, the allegations sound like a throwback to the days when artists and musicians were routinely scammed out of millions by managers, accountants and unscrupulous record-label executives. It appears Rihanna is taking steps to avoid the same fate by taking her finances into her own hands, which is what hip-hop mogul Russell Simmons has advocated for years.

Read more at MSN.

Like The Root on Facebook. Follow us on Twitter.  

Comments
The Root encourages respectful debate and dialogue in our commenting community. To improve the commenting experience for all our readers we will be experimenting with some new formats over the next few weeks. During this transition period the comments section will be unavailable to users.

We apologize for any inconvenience and appreciate your continued support of The Root.

While we are experimenting, please feel free to leave feedback below about your past experiences commenting at The Root.
The Root 100 People's Choice Awards  
Sept. 19 2014 8:34 AM