PracticeAccounting FirmsKPMG fined $450m over tax shelters

KPMG fined $450m over tax shelters

KPMG fined £255m over tax shelter abuse, subject to deferred prosecution and nine partners indicted

KPMG has been fined $456m (£255m) but escaped immediate prosecution in
connection with what the US Department of Justice called ‘the largest ever tax
shelter fraud’.

In return for deferred prosecution KPMG has agreed to pay the fines,
cooperate fully with further government investigations and establish a
compliance and ethics program intended to prevent the firm from repeating the
same offences.

A Department of Justice spokesman said nine partners from the firm who
allegedly participated in the tax shelter scheme have been indicted and will
face charges of creating tax shelters, preparing false tax returns and hiding
their actions from the Internal Revenue Service.

Attorney general Alberto Gonzales said this was a case in which the DOP’s new
task force on corporate fraud ‘ was able to detect and punish the kind of
corruption found at KPMG, and in doing so, help to restore a level of faith and
confidence in the honest and transparent business practices that have made ours
the greatest economy in the world’.

The news brings to end specualtion over the firm’s future as a result of the
tax shelter investigation. A criminal conviction for the firm would have brought
a ban in many US states from holding an audit licence.

The investigation alarmed authorities that it might reduce the current Big
Four auditors to a Big three creating major problems over conflicts of interest.

Related Articles

Sexual harassment – is accountancy next for #MeToo?

Accounting Firms Sexual harassment – is accountancy next for #MeToo?

1d Karen Baxter, Lewis Silkin
Johnston Carmichael CEO appointed as ICAS president

Accounting Firms Johnston Carmichael CEO appointed as ICAS president

3w Emma Smith, Managing Editor
British Accountancy Awards 2018 – entries open!

Accounting Firms British Accountancy Awards 2018 – entries open!

1m Emma Smith, Managing Editor
Is the accountancy sector facing an international talent crisis?

Accounting Firms Is the accountancy sector facing an international talent crisis?

1m Lewis Silkin
RSM appoints new Chief Operating Officer

Accounting Firms RSM appoints new Chief Operating Officer

1m Alia Shoaib, Reporter
RSM announces 11 partner promotions

Accounting Firms RSM announces 11 partner promotions

2m Emma Smith, Managing Editor
BDO hires former AstraZeneca creative director as head of digital and innovation

Accounting Firms BDO hires former AstraZeneca creative director as head of digital and innovation

2m Emma Smith, Managing Editor
What does the future hold for listed accountancy firms?

Accounting Firms What does the future hold for listed accountancy firms?

2m Fergus Payne, Lewis Silkin