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‘Stealing the exam’
08 February 2018
Six US accountants have now been formally charged by the US Securities and Exchange Commission over their alleged participation in a scheme to misappropriate and use confidential information relating to the Public Accounting Oversight Board’s (PCAOB) planned inspections of KPMG.
The SEC says that unauthorised disclosures enabled KMPG partners to analyse and revise audit work papers in an effort to avoid negative findings by the PCAOB. At the time nearly 50% of KPMG’s inspected audits were deemed to be ‘deficient’.
Three former PCAOB officials, Brian Sweet, Cynthia Holder, and Jeffrey Wada have all been charged, along with three former KPMG accountants David Middendorf, Thomas Whittle and David Britt. Both Sweet and Holder were in fact working at KMPG when the scheme came to light.
According to the SEC’s order the misconduct began in 2015 and went on until February 2017.
Steven Peikin, co-director of SEC’s Enforcement Division, said: “As alleged, these accountants engaged in shocking misconduct – literally stealing the exam – in an effort to interfere with the PCAOB’s ability to detect audit deficiencies at KPMG.”
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