KPMG to appeal $41m negligence verdict

KPMG is appealing a professional malpractice and negligence verdict after a
Jersey jury awarded Cast Art more than $41m in damages.

Cast Art sued KPMG in 2003 for for failing to detect financial fraud at
NJ-based Papel Giftware which Cast Art acquired in December 2000, claiming KPMG
knew of the fraud but purposely overlooked it in order to assist the chairman of
Papel’s board, who provided significant business to KPMG. WebCPA

KPMG argued in its defense it had indicated during the three years it was the

auditor of the company there were problems, but Cast Art decided to buy Papel


‘We do not believe that there is a factual basis for this verdict, and are
it will be reversed on appeal,’ Dan Ginsburg, KPMG spokesman, said.

Further reading:

the WebCPA story

Related reading