A Hewlett-Packard logo is seen at the company's Executive Briefing Center in Palo Alto, California January 16, 2013.

NEW YORK | Fri Jan 18, 2013 4:10pm EST

NEW YORK (Reuters) - A U.S. investor activist group affiliated with large labor unions is asking Hewlett-Packard Co to replace its auditor, Ernst & Young, over the technology giant's troubled acquisition of UK software company Autonomy.

Change to Win Investment Group (CtW), based in Washington, D.C., also is seeking a revamp of HP's audit committee, which is responsible for overseeing Ernst & Young's long-standing relationship as the auditor that reviews HP's books.

Spokesmen for HP and Ernst & Young declined to comment.

Labor union pension funds own large stakes in many U.S. companies and often use them as platforms to push for changes in how those corporations are managed. Union pension funds tied to CtW invest more than $200 billion in stocks, including shares in HP, said CtW in a letter to an HP board member on Thursday.

CtW questioned why Ernst & Young did not spot problems at Autonomy. "HP is clearly a company facing serious challenges," CtW said in its letter. "Unfortunately, the highly conflicted, decade-long relationship between Ernst & Young and HP cannot provide shareholders with the reassurance they need."

Auditors are outside accounting firms retained by corporations to vet their books regularly and offer an opinion on the validity of financial results. The four firms that dominate auditing worldwide - Ernst & Young, KPMG, Deloitte and PricewaterhouseCoopers - are faced with ever-rising scrutiny of their role in investor losses and accounting lapses.

The CtW letter was addressed to Rajiv Gupta, chairman of the corporate governance committee of HP's board. It was signed by William Patterson, executive director of CtW Investment Group.

Gupta could not be reached for comment.

HP, AUTONOMY CLASH

HP said in November that it overpaid for Autonomy in 2011. HP accused Autonomy of serious accounting improprieties. Autonomy has rejected the allegations and said HP was looking for "scapegoats."

CtW urged HP to name an independent special master to investigate and report to shareholders on the Autonomy deal, as well as on an earlier acquisition of Electronic Data Systems Corp (EDS), which CtW said was "equally disastrous."

HP has said it is deferring to U.S. and UK regulators to investigate the allegations it has made against Autonomy.

HP in August swung to an $8.9 billion quarterly loss as it swallowed a write-down linked to its $13.9 billion purchase of EDS. That was followed in November by an $8.8 billion writedown on Autonomy's value, which HP blamed largely on improper accounting at the software company.

Ernst & Young was not Autonomy's auditor. But according to CtW, the accounting firm had an opportunity to spot Autonomy's problems when it reviewed the goodwill, or intangible value, that HP recorded for its acquisition of Autonomy.

However, one risk expert said CtW was putting the blame in the wrong place. A separate due diligence team, not the auditor, was responsible for determining the value of Autonomy, said Peter Bible, chief risk officer at EisnerAmper, an accounting and consulting firm.

"The auditors didn't buy the company, HP did. And the people inside HP ought to be the ones held accountable for the purchase price that was paid," Bible said.

CtW questioned whether Ernst & Young was independent enough to audit HP because of the large amount of non-audit services Ernst provided to HP, including tax consulting and lobbying.

Washington Council, a tax lobbying firm acquired by Ernst in 2000, lobbied for HP from 2000 to 2004, CtW said.

AUDITING, LOBBYING EYED

Government lobbying records and U.S. Securities and Exchange Commission filings show that Ernst & Young was HP's auditor while Washington Council was registered as a lobbyist for HP.

Reuters reported last week that the SEC was investigating whether Ernst violated auditor rules by letting its lobbying unit perform work for some major audit clients.

Ernst has said all of its services for audit clients undergo considerable scrutiny to be sure they are within the rules.

U.S. independence rules bar auditors from serving in an "advocacy role" for audit clients. The goal of this rule is to ensure that auditors are objective regarding companies they audit so that they can serve as watchdogs for investors.

It is not clear what type of lobbying activities would be barred under the prohibition against advocacy.

The 2002 Sarbanes-Oxley Act restricted the type of non-audit services that audit firms can provide, but broad exceptions were granted for tax consulting services.

CtW said that HP was out of step with its peers in using Ernst for significant services other than audit work. The other fees paid to Ernst are much higher than those paid by Dell Inc and Apple Inc to their audit firms, CtW said.

CtW also questioned the HP audit committee's willingness to allow Ernst to perform "multiple and conflicting roles" for HP.

Board audit committees hire and oversee outside auditors, while also governing non-audit services.

(Additional reporting by Sarah Lynch and David Ingram in Washington; Editing by Kevin Drawbaugh)

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1 of 5. A portait of late PKK activist Sakine Cansiz is seen at the Kurdish cultural centre in Paris, after three Kurdish women were found shot dead, January 10, 2013. Three female Kurdish activists including a founding member of the PKK rebel group were shot dead in Paris overnight in execution-style killings condemned by Turkish politicians trying to broker a peace deal.

ISTANBUL | Fri Jan 11, 2013 10:19am EST

ISTANBUL (Reuters) - Kurdish rebels suggested on Friday that clandestine Turkish nationalists may have assassinated three Kurdish activists in Paris, but Prime Minister Tayyip Erdogan said the killings appeared to have been the result of an internal feud.

The Kurdistan Workers Party (PKK) said the execution-style killings in an institute in central Paris had been premeditated and planned and warned France would be held responsible if it failed to get to the bottom of their deaths.

Sakine Cansiz, a founding member of the PKK, and two fellow activists were found shot in the head early on Thursday in an attack which shocked the Kurdish community and overshadowed peace moves between Turkey and the rebels.

Turkey put its missions in Europe - home to a large Kurdish diaspora - on alert and asked the French authorities to boost security around its interests there, after the pro-Kurdish Peace and Democracy Party (BDP) called for protest meetings.

Around 200 Swedish Kurds chanting "Long Live the PKK" and "Turkey, Terrorists" demonstrated in sub-zero temperatures outside the French embassy in Stockholm. A demonstration was also planned in Berlin, home to a large Kurdish and Turkish population.

"The targeting of three of our female comrades at a time like this is a premeditated, planned and organized attack," said a statement on the website of the armed wing of the PKK.

"France has a responsibility to elucidate these killings immediately. Otherwise, they will be held responsible for the massacre of our comrades."

The statement blamed "international and Turkish Gladio forces" for the killings, a reference to NATO's Cold War anti-communist Gladio operations, now used in Turkey as shorthand for alleged state-sponsored nationalist violence.

Shadowy Turkish nationalist groups are believed to have killed hundreds of activists in the mainly Kurdish southeast over the past three decades.

Turkish media reports have also suggested the possible involvement of Syria or Iran, which both have Kurdish minorities and are at odds with Ankara over issues including the conflict in Syria.

Erdogan said that while investigations needed to be completed before a definitive conclusion could be reached, evidence so far pointed to an internal feud, as the building was secured by a coded lock which could be opened only by insiders.

"Those three people opened it. No doubt they wouldn't open it to people they didn't know," Erdogan told reporters on his plane returning from Senegal on Friday, according to the state-run Anatolian news agency.

He said the killings could also have been intended to sabotage efforts towards peace talks with the PKK.

THREAT TO PEACE TALKS

Cansiz was a prominent PKK figure, initially as a fighter and later in charge of the group's civil affairs in Europe. A 1995 photograph shows her standing next to militant leader Abdullah Ocalan, wearing olive battle fatigues and clutching an assault rifle.

French investigators gave no immediate indication of who might be behind the murders. The PKK has seen intermittent internal feuding during an armed campaign in the mountainous Turkish southeast that has killed some 40,000 people since 1984.

Turkish nationalist militants - linked by critics of Turkey's military to the security establishment - have in the past also been accused of killing Kurdish activists, who want regional autonomy. But such incidents have been confined to Turkey.

"Kurds don't benefit from this murder. I don't think in-fighting is at all behind this," said Eren Keskin, one of Ocalan's lawyers who first met Cansiz in 1991.

"The Kurdish problem isn't just in Turkey, it involves many states in the Middle East, Europe and the United States. There are many circles that are uncomfortable with the prospect of peace, and there are many who profit from the lack of peace."

Turkey recently announced it had begun talks with Ocalan, jailed on the small island of Imrali near Istanbul. Hardliners in the PKK, deemed a terrorist group by Ankara, Washington and the European Union, are likely to be skeptical about such talks.

According to media reports, the Turkish state and PKK have agreed the framework for a peace plan, which would involve boosting Kurdish minority rights in exchange for the ultimate disarmament of the militants.

"If the events surrounding this murder aren't revealed, then this process will collapse, sooner or later," Sebahat Tuncel, a BDP lawmaker who knew Cansiz, told Reuters.

"Anyone who knows the Kurdish movement and its history knows it is not possible for the PKK to fracture like this ... In the past, these types of provocations that have derailed peace efforts have come from the state," she said.

Erdogan has introduced reforms allowing Kurdish language broadcasting and other concessions on language; but activists are demanding more freedom in education and administration.

Kurdish politicians are also demanding improved prison conditions for Ocalan with a view to him being released from jail and put under house arrest, but Erdogan played down any changes in Ocalan's situation.

"The conditions at Imrali are better than those in any country in the world and we're talking about special treatment," Erdogan said. Ocalan was able to walk daily in a courtyard with other inmates and would be given a television, he said.

(Additional reporting by Jonathon Burch in Ankara, Daren Butler in Istanbul, Alistair Scrutton in Stockholm and Alexandra Hudson in Berlin; Writing by Nick Tattersall; Editing by Myra MacDonald)

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KADUNA, Nigeria | Sun Dec 23, 2012 6:15pm EST

KADUNA, Nigeria (Reuters) - Nigerian Islamist group Ansaru said on Sunday it was behind the kidnap of a French national last week, citing France's ban on full-face veils and its support for military action in Mali.

Ansaru sent a message to Nigerian reporters saying it was holding 63-year-old Francis Colump, who was taken on December 19 when around 30 gunmen attacked his residence in the remote northern town of Rimi, close to the Niger border.

The Nigerian police declined to comment on the claim but had already named Colump as the man abducted. He was working for French renewable energy firm Vergnet, which had been building Nigeria's first wind farm.

"The reason we kidnapped him is ... the law the government created which prohibits the wearing of niqab by French Muslim women. This is a denial of their religious rights," said the statement by the group, written in the local Hausa language.

"And again the participation of France in supporting the military attack on Muslims in northern Mali," the message signed by the group's purported leader Abu Usamata Ansari said.

In recent months France has led support for an African-led force to help defeat al Qaeda and other Islamist militants in northern Mali. Military deployment has the backing of the U.N. Security Council.

Last year, France banned full face veils.

Ansaru's full name is Jama'atu Ansarul Musilimina Fi Biladis Sudan, which roughly translates as "Vanguards for the Protection of Muslims in Black Africa".

The group, thought to be a breakaway from better known Islamist sect Boko Haram, has risen to greater prominence in recent weeks.

It claimed responsibility for a dawn raid on a major police station in the Nigerian capital last month, where it said hundreds of prisoners were released.

Britain last month put Ansaru on its official "terrorist group" list, saying it was aligned with al Qaeda and was behind the kidnap of a British and a Italian killed earlier this year during a failed rescue attempt.

Ansaru is thought to have loose ties to Boko Haram, which has killed hundreds this year in an insurgency focused mostly on Nigerian security forces, religious targets and politicians, rather than foreigners.

Western governments are increasingly concerned about Islamists in Nigeria linking up with groups outside the region, including al Qaeda's north African wing.

Colump's kidnap takes to nine the number of French citizens currently held hostage in Africa: seven others are in the arid Sahel belt and one in Somalia.

France's Intelligence agency said last week it believed "terrorist" links were behind the latest abduction.

"We are informing the government of France that we would continue to attack ... its citizens anywhere in the world as long as the government does not retract on its policies," Ansaru's statement said. ($1 = 0.7590 euros)

(Additional reporting and writing by Joe Brock; editing by Jason Webb)

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KUALA LUMPUR | Thu Sep 27, 2012 6:05am EDT

KUALA LUMPUR (Reuters) - Malaysia's Tune Group, a financial services-to-discount hotel conglomerate owned by AirAsia Bhd's founders, said it plans to list its insurance arm in a move to fund the company's expansion overseas.

Tony Fernandes and Kamarudin Meranun, who in 1993 founded Asia's biggest budget carrier, plan to list Tune Insurance Malaysia in a move that comes hot on the heels of other planned initial public offerings by AirAsia.

These include listings by AirAsia's long haul arm AirAsia X and its Indonesian unit.

"Tune Insurance is definitely going to be the first candidate to go public under the Tune brand. As to when, we are looking at it but no news as of yet," Fernandes told reporters on Thursday in the Malaysian capital.

"It has a good business, it is in a fantastic part of the world, which is under insured. We are looking at acquisitions in Thailand, Indonesia and the Philippines," he said in reference to Southeast Asia.

It was not immediately clear how much the IPO intended to raise and where the company would list.

Tune Group has been expanding its insurance business in preparation for the listing.

In April, Tune Group bought a 77.9 percent stake for 153.13 million ringgit ($49.69 million) in Oriental Capital Assurance Bhd, in a move to beef up its financial services division and allow it to underwrite its insurance businesses.

Tune Group now owns some 83 percent in Tune Insurance, according to its chief executive officer Peter Miller. It could not be immediately ascertained who owned the remaining stake. ($1 = 3.0820 Malaysian ringgits)

(Reporting by Yantoultra Ngui and Anuradha Raghu; Editing by Muralikumar Anantharaman)

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