BusinessCorporate FinanceBDO case sparks global network alert

BDO case sparks global network alert

The result of BDO International's liability case with Banco Espirito Santo could have a serious impact on entire profession says Newman

Jeremy Newman, BDO Stoy Hayward

Jeremy Newman, BDO Stoy Hayward

Jeremy Newman has said that BDO International’s fight to avoid liability in
the Banco Espirito Santo case will be ‘significant’ for the entire profession.

The BDO network could face a bill in the case, likely to be substantial if
upheld, after a US appeal court decided that a jury should decide if it should
be made
jointly liable.

BDO Seidman is already facing a liability which it has claimed it cannot pay,
of $521m (£258m), as a result of a finding of ‘negligence’ against one its
audits.

Banco Espirito Santo attorney Steven Thomas said this week: ‘The victory
means that ultimately BDO International, along with all the BDO member firms and
offices worldwide, will be jointly liable for the $521m judgment against BDO
Seidman.’

‘That’s a heck of a jump,’ said a BDO Seidman spokesperson. ‘The case is
currently under appeal.’

Newman told Accountancy Age that he was confident that the decision
to keep BDO
International out of the firing line would be upheld. ‘We’re entirely
unconcerned,’ the BDO managing partner said.

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