The US Treasury recently affirmed reappointment of KPMG as Citi’s auditor for the 41st consecutive year. Maybe Treasury married KPMG all over again because they’re cheap compared to what Goldman and AIG are paying PwC. Or maybe Treasury feels like the mother who puts up with a gold digging daughter-in-law because said daughter-in-law saw mom kissing the tennis pro and mom knows her son has slept with the baby-sitter…
Dean Starkman edits The Audit, a critique of the business press at the Columbia Journalism Review. I had the good fortune to be cited recently – it’s the fourth time if you’re keeping count – by The Audit and Starkman for my coverage of KPMG’s settlements of their Countrywide and New Century litigation. Speaking of […]
It’s no coincidence that settlements were announced less than a week apart for both New Century and Countrywide. As two of the earliest subprime failures, all parties were probably anxious to clear some clutter and make room for other matters. But with no trials, the truth about KPMG’s role in both Countrywide and New Century will be buried.
June 24, 2010: An exclusive from Steven Thomas, attorney for the New Century Liquidating Trustee: “The New Century Liquidating Trustee and KPMG LLP have entered into a confidential settlement agreement, pursuant to which the lawsuits and arbitration against KPMG LLP and KPMG International have been resolved.” Update: July 30, 2010 The court appointed Liquidating Trustee […]
If you are a regular reader of this site, you may remember the first time I warned you about the poor disclosure practices surrounding repurchase risk. It was all the way back in March of 2007 and I was referring to the lack of disclosures surrounding New Century Financial. I warned you again seven months ago that another KPMG client, Wachovia/Wells Fargo, has the same disclosure issues with regard to repurchase risk. The latest announcements of potentially material losses due to forced repurchases of mortgages from Fannie Mae (Deloitte) and Freddie Mac (PwC) were made by JP Morgan and Bank of America – both audited by PwC. Maybe ya’ll should kick the tires a little more on Citibank’s big comeback.
My latest post is up @Going Concern. Sex. Drugs. They didn’t mention rock and roll but I’m sure those stories will come out too eventually. Bernie and Elton John. Bernie and Mick Jagger. Bernie and Pink. Never mind. Scratch Elton John. If it weren’t bad enough to have so many subprime lawsuits hanging over their […]
I wrote a post today, joining the discussion over at Clusterstock.com regarding Wells Fargo and their apparent lack of disclosure for various risks. Did Wells Fargo’s Auditors Miss Repurchase Risk? “How does the New Century situation and KPMG’s role in it remind me of Wells Fargo now? Well, in both cases, there’s no disclosure of the […]
KPMG is being sued for $1bn by the liquidators of New Century, the collapsed subprime lender, in the first big case against an auditor arising from the current financial crisis. If the New Century trustee is successful, “it may embolden others to look more closely at the possibility of bringing [accounting] firms to some level of culpability for the things that happened,” that led to the credit crisis, Francine McKenna, president of McKenna Partners LLC, a corporate-governance consultancy, said in an interview in the Wall Street Journal.
You may question my choice of title for this post. After all, it describes the end of the tax shelter prosecution of the KPMG 13. And it was former KPMG employees, not current KPMG employees or partners who cheered when federal Judge Lewis Kaplan dismissed charges yesterday against them, 13 former employees of the accounting […]
The Friday after Thanksgiving should be a quiet news day. But not in this crisis environment. In addition to heartbreaking news from Mumbai, two more stories about KPMG were caught in my newsnet in the last twenty-four hours. The first story is the latest in a long series of stories I’ve written about Siemens. The […]