Leaks from a confidential auditor report into the activities of bankrupt anti-piracy law firm Johan Schlüter suggest that the company defrauded its entertainment industry clients out of $25m. One lawyer was singled out for most criticism after enriching both herself and family members.
In the early 2000s, international and Danish entertainment industry groups came together to tackle piracy of movies, music and other media.
The resulting Antipiratgruppen (now RettighedsAlliancen / Rights Alliance) needed legal representation and local lawfirm Johan Schlüter was hired for the job, representing groups including the MPAA.
In the years that followed Johan Schlüter became involved in dozens of anti-piracy cases but after continually accusing pirates of being thieves, eventually the tables began to turn. Earlier this year it was reported that an investigation into the company’s accounts had uncovered financial irregularities amounting to millions of dollars.
Carried out by U.S. auditing giant Deloitte, the investigation found that while Johan Schlüter had been collecting rights revenues on behalf of several movie and TV industry groups, the lawfirm hadn’t been handing them all over. The black hole wasthought be to around $15m.
Now, however, fresh leaks from the confidential study have revealed the true extent of the shortfall. According to data obtained by Finans.dk, Johan Schlüter failed to hand over around $25m.
The now-defunct Johan Schlüter lawfirm had three owners – Johan Schlüter himself, Lars Halgreen and Susanne Fryland. The latter was responsible for the management of the TV and film producer accounts and appears to be the partner most in the firing line.
Between 2011 and 2015 before Johan Schlüter went bankrupt, Fryland is said to have pocketed almost $2.4m in consultancy fees. In addition the lawyer gave jobs to family members, with one getting paid a salary of more than $94,000. Deloitte said it had difficulty finding out what this person was employed to do.
Another, Fryland’s mother-in-law, was originally employed to deal with administrative issues. However, when Fryland left to have a child, her mother-in-law was given more than a year off while getting paid almost $84,000 to look after the baby.
Klaus Hansen, director at the Producers’ Association, says the report has left him speechless.
“I didn’t think I could be surprised over more in this case, but if it wasn’t so tragic, Deloitte’s report would be worthy of an absurd movie,” Hansen says.
While Susanne Fryland is refusing to comment on the latest allegations, Johan Schlüter maintains he was unaware of any wrongdoing.