قالب وردپرس درنا توس
Home / Insurance / KPMG risks $ 18 million in fines for misleading regulator

KPMG risks $ 18 million in fines for misleading regulator



(Reuters) – KPMG International Ltd. faces a fine of 14.4 million pounds (17.6 million USD) after admitting that it misled regulators during random checks of audits of the construction group Carillion and the software company Regenersis.

The Financial Reporting Council, the UK’s audit authority, told a London court on Thursday that it had demanded a record £ 20m fine, reduced to £ 14.4m because KPMG self-reported and co-operated.

“It was indefensible and wrong,” said KPMG CEO Jon Holt in a statement, adding: “It was a violation of our processes and a betrayal of our values.”

KPMG, one of the four major auditors dominating the market along with EY, Deloitte and PwC, acknowledged that they had acted wrongly at a first London tribunal in January and reiterated their apology at the start of a two-day hearing.

“I̵

7;m sorry that a small number of former employees acted in such an inappropriate way, and it is right that they – and KPMG – are now facing serious regulatory sanctions,” Holt said.

The General Court found five former KPMG employees guilty of misconduct during a routine inspection of the FRC by a Regenersis audit to the end of June 2014 and a Carillion audit at the end of December 2016.

The FRC, which seeks to fine them between £ 50,000 and £ 400,000 and ban them from the profession for up to 15 years, claimed to have provided false or misleading information or documents to the regulator.

The five had denied the allegations.

The board will decide on sanctions at a later time.

Since KPMG is responsible for the behavior of its employees, it faced the same accusations.

The procedure did not deepen in the underlying audit work. The FRC is separately investigating KPMG’s reviews of Carillion, whose collapse in 2018 led to recommendations for a sectoral transformation, although legislation has not yet been tabled in parliament.

KPMG has separately promised to defend itself against a $ 1.3 billion ($ 1.6 billion) lawsuit from Carillion’s missing red flag liquidators, in one of the biggest claims against top accountants to date.


Source link