BusinessCompany NewsTyco hands over PwC claim as it settles for $3bn

Tyco hands over PwC claim as it settles for $3bn

Tyco assigns claims to shareholders to sue PwC for not detecting fraud after signing off on huge payout to investors

Tyco International
has assigned claims against its former auditors
PwC to investors, after
agreeing to pay $3bn (£1.5bn) to settle its own case out of court.

Following the settlement of the class-action case, Tyco brokered a deal
with investors giving them its right to sue the auditors. In return, the
shareholders will effectively give Tyco their claims against former CEO and CFO
Dennis Kozlowski
and Mark
Swartz
, receiving half of whatever the company recoups from the pair.

Actions from shareholders are already pending against PwC, and the new claims
are set to be pursued alongside.

The telecoms and security giant was embroiled in a securities fraud lawsuit
after the two executives were implicated in a profit manipulation scandal. 

Kozlowski and Swartz were accused of inflating revenues by $5.8bn, raking
in $150m for themselves during the late 1990s and early 2000s.The scandal wiped
$100bn from the company’s market value.

Lawyers for the shareholders said the Tyco settlement with shareholders would
top $3 billion with interest, making it the largest payout ever by a single
corporate defendant in a securities fraud lawsuit

Further reading:

Livedoor boss jailed for two and a half
years

$40bn class-action Enron suit blocked 

Penthouse International settles accounting
fraud charges

Related Articles

M&S business rate liabilities based on £570m rateable value

Company News M&S business rate liabilities based on £570m rateable value

4m Emma Smith, Managing Editor
BDO replaces Deloitte as Mitie auditor

Audit BDO replaces Deloitte as Mitie auditor

8m Emma Smith, Managing Editor
CVR Global appoints partner in London office

Company News CVR Global appoints partner in London office

1y Alia Shoaib, Reporter
FTSE100 failing to provide adequate ethics information

Company News FTSE100 failing to provide adequate ethics information

1y Alia Shoaib, Reporter
Moore Stephens recruits new private client partner

Accounting Firms Moore Stephens recruits new private client partner

1y Emma Smith, Managing Editor
Magma Group announces merger, partner promotions

Accounting Firms Magma Group announces merger, partner promotions

1y Emma Smith, Managing Editor
BDO on ‘recruitment spree’ with multiple partner appointments

Accounting Firms BDO on ‘recruitment spree’ with multiple partner appointments

1y Emma Smith, Managing Editor
Brand strength leads to fee income growth for RSM

Accounting Firms Brand strength leads to fee income growth for RSM

1y Emma Smith, Managing Editor