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Bankers and lawyers have informed Congress that the Saudis threatened them with 20 years in prison if they cooperate with the ongoing PGA Tour-LIV Golf merger probe.
This news was revealed in hearing held by the Senate Committee on Homeland Security and Governmental Affairs’ permanent subcommittee on investigations on Tuesday.
According to investment banker Michael Klein of M. Klein & Company, Saudi Arabia’s Public Investment Fund (PIF) sued its advisers in a Saudi court to stop them from submitting information to the United States Senate committee on homeland security and governmental affairs.
Klein, one of the top advisers to the fund, told Congress that violating the court order that resulted from the lawsuit could lead to executives and their staffers going to prison for 20 years.
“Exposing ourselves to a breach under the filed court case with potential criminal consequences is simply not a risk I can take or impose on my employees,” said Klein. “And while I understand views may differ about the severity of the order, if the analysis is wrong, the consequences fall exclusively on me, my employees, and their families.
Mackenzie Hawkins of Bloomberg reported, “US lawmakers slammed the advisers for not cooperating with their inquiry, noting the firms have only provided a fraction of the documents demanded in a congressional subpoena.”
“The PIF has been explicit that the disclosure of information relating to BCG’s work for PIF is a violation of Saudi law, which ‘imposes criminal penalties for disclosing or disseminating such information including imprisonment for a maximum of 20 years,'” said Boston Consulting Group’s Rich Lesser, another adviser to the PIF. “We risk criminal and financial penalties for the firm and for individuals working or living in Saudi Arabia.”
Senator Richard Blumenthal reacted to the stonewalling by responding, “It’s simply staggering to me that American companies are not only willing to accept this claim, allowing the Saudi government to determine what is permitted to provide this subcommittee — but also that they would use it to justify their refusal to comply with a duly issued congressional subpoena.”
Another member of the subcommittee investigating the LIV Golf–PGA Tour merger, Senator Ron Johnson, agreed with Blumenthal.
“I do have sympathy for the position the consultants find themselves in, but I have no sympathy for Saudi claims of sovereign immunity in this inquiry,” he said. “Any foreign entity wishing to do business in the U.S. must comply with U.S. law and be responsive to Congressional subpoenas.”
It appears, based on the testimony given this week, as if there is still a long way to go before the two golf tours are able to officially join forces.