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To: StockDung who wrote (82997)	1/17/2003 10:00:25 AM
From: SEC-ond-chance	Respond to of 122087

New Tel man in the muddle By Geoff Elliott 18jan03 DOMENIC Martino has always been described as an accountant with entrepreneurial vision, and for more than a decade it served him well as he rose to the top of Australia's corporate circles. A player in Perth in the 1980s with accountants Nelson Wheeler, BDO Nelson Parkhill and then Deloitte Touche Tohmatsu, Mr Martino won a reputation for being party to aggressive deal-making that won his firms big fees. But Mr Martino now faces some difficult questions about his role in failed telecommunications company New Tel, and the possibility that it might have traded while insolvent while he was a director. Mr Martino resigned from New Tel in late March 2002, saying he left the company in fine shape. Already the liquidator to PWC has questioned that, flagging the possibility that the company might have been insolvent for 12 months. If true, Mr Martino could face criminal charges and be forced to contribute personal assets to meet the creditors' shortfall. Mr Martino denies the company was insolvent while he was a director. The liquidator is clearly casting the net as far and wide as possible, as it justifies its investigations into the company and the fees it earns – more than $600,000 at last count. But the perception around Mr Martino's role at New Tel isn't doing him – or his firm Deloitte – any favours. It has highlighted the dangers of professional advisers mixing it as businessmen. This has been a feature of Mr Martino's career. It's something other accounting firms forbid their partners doing. "We have no partners that are directors of public companies," said Ernst & Young chief executive Brian Schwartz. Ernst & Young's policy expressly forbids it. It's the same at another global giant, KPMG. A spokeswoman said: "Basically, all partners aren't allowed to participate in publicly listed companies." PWC wasn't as definitive, but it promised that "all proposed external directorships are subject to a rigorous review process before approval is given". "In the course of the review, all relevant issues are considered, including whether an appointment would cause a conflict of interest or independence concerns for the firm." The policy at Deloitte? It doesn't have one. The Weekend Australian asked head of communications Matt Batters, in New York, for the firm's policy on external directorships for partners. "Our global approach is to have local policies that at least satisfy the specific legislative and regulatory requirements of each country," he said. "Our global principles of integrity and quality guide our local policies." Mr Martino denies he's in a position of any conflict. But Deloitte continues to act as a client for a company of which he's a board member. More than $500,000 was paid last year to Deloitte by Sydney Gas, which Mr Martino chairs. New Tel paid Deloitte more than $4 million through 2000 and 2001. Millions more were paid by New Tel to interests associated with Mr Martino, given his long association with New Tel (formerly Transcom) and its chief, Peter Malone. Mr Martino first joined the board of Transcom in 1990. The list of private companies with which he's been involved since the 80s extends to more than 100. It includes a tie-up with former Jeans West owner Alister Norwood in Perth in an internet-based lingerie company called No Regrets. Mr Martino chaired the company. In 1999 it issued a prospectus filled with photos of models in lingerie. The financial models were also scantily clad – so little information was provided that the Australian Securities and Investments Commission put an interim stop order on the prospectus, forcing No Regrets to issue supplementary information. Deloitte provided tax advice on the prospectus. Mr Norwood refused to speak about No Regrets, and it's unclear how much money the company eventually raised. The last word was that it was being sold to another Perth-based company, Fashion Intimates. theaustralian.news.com.au

To: StockDung who wrote (82997)	1/20/2003 7:53:39 AM
From: SEC-ond-chance	Read Replies (8) \| Respond to of 122087

Greatest ADR SCAM ever? its starting to look that way Deloitte chief quits 20jan03 DELOITTE Touche Tohmatsu chief executive Domenic Martino has quit his post, amid controversy surrounding his previous involvement with the failed junior telco, New Tel. Mr Martino, who took on Deloitte's top job in May 2001, has been dogged by controversy surrounding his position as a director of New Tel and whether it was trading while insolvent before he resigned last year. Deloitte has temporarily returned Mr Martino's predecessor and chairman Lynn Odland to the chief executive's post while it searches for a permanent replacement. The chairman's job will be filled by Harley McHutchison. In a statement, Deloitte said Mr Martino, who was also chairman of Sydney Gas Ltd, was leaving to "consider his future". "He cited as reasons for his decision to resign - the ongoing publicity associated with his past directorship of New Tel and his belief that it was good corporate governance and in the best interests of Deloitte and its people for him to step aside while New Tel's affairs were investigated during liquidation, a process that could take many years," Deloitte said. Mr Martino believed any future investigation of New Tel would show he "properly fulfilled his duties as a director" until he resigned in February 2002, 11 months before the telco went into liquidation, the company added. In another twist, Deloitte has banned its partners and staff from holding directorships in public companies and, with limited exceptions, in proprietary firms. The change is expected to affect about half a dozen of the company's staff. "While holding directorships has been accepted practice in Australia for many years by legal, accounting and management consultants, Deloitte believes changing market attitudes towards corporate governance and our own commitment to best practice in governance globally, dictates a change in policy," Mr Odland said. Last Monday, New Tel's creditors voted to place the Perth company into liquidation amid concerns it was possibly trading insolvent for more than 12 months. New Tel owes $40 million to $50 million to employees and creditors - including Optus, which appointed PricewaterhouseCoopers (PwC) as administrator in December. New Tel shares were suspended from trading in October after it failed to lodge its audited annual accounts. heraldsun.news.com.au