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 […]
It looks like the saga of Computer Associates is far from over. You may recall that KPMG, their long time auditors, are still their long time auditors. And you may recall that, at one time, Computer Associates management said that their accounting troubles were all behind them. After all, management now is an […]
We’re just spinning and swirling… See my comment on this article here. The auditor should have done more work to support its opinions at 10 companies, the board’s inspection report says.Sarah Johnson, CFO.com | US August 18, 2008 KPMG failed to do the proper evaluations and testing procedures to back up its assessments of 10 […]