SEC Could Level $50M Fine on KPMG Over PCAOB Cheating Scandal

By:
Chris Gaetano
Published Date:
Jun 14, 2019
SECURITIES-AND-EXCHANGE-COMMISSION-facebook

The Securities and Exchange Commission is considering a $50 million fine against KPMG, one of the largest it has ever leveled, for a scandal in which audit partners colluded with staffers from the Public Company Accounting Oversight Board (PCAOB) who passed on inside information about the agency's inspection plans for the firm, according to the Wall Street Journal.

The former partners and staffers were charged with conspiracy at the beginning of last year. The scheme involved confidential documents from the PCAOB, outlining its inspection plan for the Big Four firm, which were leaked by staffers to KPMG in exchange for a job. This happened more than once, with the information each time being passed on by a PCAOB staffer who then went on to work for KPMG. A group of the firm's audit partners had known about this scheme, and indeed pressured the former staffers for additional inside information. Two of the defendants, a KPMG audit partner and a former PCOAB staffer, were convicted earlier this year on conspiracy and fraud charges. Other defendants had already pleaded guilty by then.

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