KPMG US to pay hefty fines
US firm pays thousands in fines to regulator over dubious tax shelter schemes
KPMG US’s tax shelter case has seen the firm receive
penalties
on 96 violations.
The firm must pay $1000 per violation – the maximum fine under Texas state
law. The firm also had to pay $3842 in administrative costs.
KPMG America’s license suspension has also been stayed in Austin Texas by the
State Board of Public Accountancy after the firm made admissions in a deferred
prosecution agreement with the US Department of Justice two years ago, relating
to tax shelters it designed, implemented and marketed between 1996 and 2002.
Under the agreement, KPMG admitted that former partners and employees
prepared fraudulent tax returns for clients; drafted false statements to support
tax shelters; issued opinions that were false; concealed tax shelters and
information about them from the tax authorities.
The firm also admitted failing to locate and produce crucial documents sought
by the tax authority and misrepresented to the firm’s role concerning the tax
shelters, to the Internal Revenue Service.
The board approved a consent order to suspend the licence but the stay order
now means the firm will be placed on probation for the next three years.
Further reading:
Former KPMG accountant pleads guilty
US regulator critical of E&Y, KPMG
audit work
KPMG
on Texas Probation for Tax Shelters