BDO Seidman caught up in Madoff scandal

by David Jetuah

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19 Dec 2008

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BDO Seidman has been caught up in the Bernard Madoff scandal, heaping more misery on the firm which is already fighting a $521m negligence dispute.

The New York Law School is suing BDO Seidman for its audits of Ascot Partners, a fund that invested heavily with Madoff's securities firm.

BDO Seidman has denied any wrongdoing in the case. 'It is understandable that investors affected by the massive fraud at Bernard L Madoff Investment Securities are frustrated and angry,' WebCPA reported.

'However, it is unfortunate that these investors would bring legal action before all of the facts are known and seek to blame others for their own investment decisions.

'BDO Seidman is not and has never been the auditor of Madoff Securities. BDO Seidman's audits of Ascot Partners conformed to all professional standards and we will vigorously defend ourselves against these unfounded allegations.'

Other accounting firms may find themselves the target of investor lawsuits in the case. Fairfield Greenwich Group, whose hedge fund invested $7.5bn in Madoff's firm, is considering suing its own auditors, PricewaterhouseCoopers, for failing to detect the fraud, according to press reports.

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