Home Accountant EY to pay $100m to settle US accusations of staff cheating on accounting exams

EY to pay $100m to settle US accusations of staff cheating on accounting exams

0

WASHINGTON, June 28 (Reuters) – Big Four accounting firm Ernst & Young will pay $100 million to settle U.S. Securities and Exchange Commission (SEC) charges that its auditors cheated on expert exams accountant (CPA) and misled the agency’s investigators.

The London-based auditor admitted the charges, the regulator said, and agreed to pay what the SEC called the highest fine against an auditor.

The CPA is the key qualification for accountants in the United States.

Join now for FREE unlimited access to Reuters.com

Register

EY also agreed to “take broad corrective action to address the company’s ethical issues,” the SEC said.

Wall Street watchdog found 49 EY professionals ‘obtained or circulated’ CPA licensing exam answer keys, while hundreds more cheated to complete CPD elements related to EY CPA ethics.

“This action involves breaches of trust by gatekeepers … tasked with auditing many of our country’s public companies. It is simply outrageous that the very professionals tasked with catching cheating by clients cheated on ethics exams” , said Gurbir Grewal, chief enforcement officer of the SEC. in a report.

“And it is equally shocking that Ernst & Young has hampered our investigation into this misconduct,” Grewal added.

EY told the SEC it had no issues with cheating when, in fact, the company was made aware of possible cheating on a CPA ethics exam by a staff member, the company said. DRY.

He added that EY had admitted that he had not corrected his submission even after an internal investigation by EY confirmed that there had been cheating, and even after his lead lawyers had discussed the matter. with the general management of the company.

The SEC order also finds that EY violated a Public Company Accounting Oversight Board (PCAOB) rule requiring the company to maintain integrity in performing a professional service.

The SEC ordered EY to retain the services of two independent consultants to help address its shortcomings. One will review the firm’s policies and procedures relating to ethics and integrity. The other will examine EY’s conduct regarding its disclosure failures, including whether any EY employees contributed to the company’s failure to correct its misleading submission, the SEC said.

Join now for FREE unlimited access to Reuters.com

Register

Reporting by Katanga Johnson in Washington; Editing by Michelle Price and Matthew Lewis

Our standards: The Thomson Reuters Trust Principles.