In a revealing, outrageous and sad look into the financial structure of major music stars, Rihanna filed a lawsuit against her accountants in Manhattan federal court for stealing millions of dollars from her since 2005, mishandling her finances and taxes—resulting in her being audited— and failing to pursue considerable amounts that she was owed for royalties.
Rihanna, 24, and her tour company, Tourihanna, is seeking unspecified compensatory damages and loss of earnings from the accountancy firm Berdon LLP and two former employees, Michael Mitnick and Peter Gounis.
In the suit, Rihanna, whose name is Robyn Fenty, is portrayed in the suit as a financial novice who became famous as a teen and relied heavily on her accountants. She began working with Berdon in 2005, when she was just 16, and “a minor with a booming music career and no knowledge or understanding of financial matters whatsoever.”
According to the lawsuit, the accountants concealed facts regarding her finances, and in a deal Rihanna’s lawyers called unusual, earned commissions based on a percentage of Rihanna’s gross receipts which were “exorbitant and expensive.”
One of the most eye-opening facts in the lawsuit was the estimation that between 2007 and 2010, the accountants earned 23 percent of gross tour receipts while Rihanna got 6 percent. The accountants said Rihanna lost millions during her “The Last Girl On Earth” tour, but still paid itself millions in fees.
After she walked away from Berdon, her “Loud” tour earned big money, alerting Rihanna and her team that Berdon had taken millions out of her pocket.
