BDO says US firm 'can still handle work'

Stoy Hayward issues first statement on US crisis over $500m legal liability over Bankest

Written by Alex Hawkes

Accountancy Age, 16 Aug 2007

BDO Seidman remains capable of handling US work for BDO Stoy Hayward's clients operating out of the states, the UK firm has said.

The US firm is facing a huge liability of $521m after the fraud at Bankest, a figure that is thought could imperil the future of the US firm, which turned over $589m last year.

Banco Espirito Santo, financial backers of Bankest, brought the case against Seidman claiming the firm failed to spot the fraud.

Seidman intends to appeal the decision of the court, with UK firm Stoy Hayward issuing a statement today: 'BDO Stoy Hayward is confident that BDO Seidman will ultimately be successful in its appeal. As with ourselves, BDO Seidman has enjoyed strong growth in recent years which reflects the strength of that firm. It remains capable of handling work for any of our clients operating in the USA and is a key part of the BDO International global network.'

Seidman has insisted it was as much a victim of the frauds as anyone else: 'BDO Seidman respectfully but forcefully disagrees with this verdict,' the firm said in a statement.'

The firm warned in court papers that losing the case could trigger severe losses and large numbers of redundancies.