PracticeAccounting FirmsKPMG faces high price for US government row

KPMG faces high price for US government row

KPMG faces fine of up to $500m and restrictions on its US tax practice, as a result of tax shelter row with US government

Speculation is mounting that KPMG may face a fine of up to $500m (£280m) as
well as restrictions on its US tax practice, as a result of its tax shelter row
with the US government.

US reports suggested the Big Four firm could face the higher penalties, up
from earlier estimates of around £50m-£150m, as a result of its sale of abusive
tax shelters.

KPMG is being investigated by US authorities over shelters that allowed
around 350 wealthy clients to avoid up to $1.4bn in tax, according to data from
US Senate investigations.

There have been suggestions more recently that the firm could face criminal
charges, raising the prospect of an Andersen-style collapse.

The partners who sold the shelters have since left the firm, but are still at
risk of criminal charges, though the firm itself is thought likely to escape
prosecution, according to reports.

The tax shelter investigation refers to tax plans sold between 1996 and 2002.
Sources close to the Big Four firm have said that the avoidance schemes were
merely part of the culture of the time, in which huge amounts of money were
being made on financial markets, and tax advisers in the US and the UK were
helping to shield the proceeds from tax.

Related Articles

BDO’s global revenues pass $8bn

Accounting Firms BDO’s global revenues pass $8bn

3d Alia Shoaib, Reporter
Top 40 International Networks, Associations and Alliances: Finding growth amid uncertainty

Accounting Firms Top 40 International Networks, Associations and Alliances: Finding growth amid uncertainty

6d Philip Smith, Reporter
Top 40 International Networks, Associations and Alliances 2017: Big Four tussle for top spot

Accounting Firms Top 40 International Networks, Associations and Alliances 2017: Big Four tussle for top spot

1w Emma Smith, Managing Editor
BDO reports revenue growth of 5.7%

Accounting Firms BDO reports revenue growth of 5.7%

2w Alia Shoaib, Reporter
Taylorcocks announces merger with Surrey firm

Accounting Firms Taylorcocks announces merger with Surrey firm

2w Emma Smith, Managing Editor
Kingston Smith reports 7% gender pay gap

Accounting Firms Kingston Smith reports 7% gender pay gap

2w Emma Smith, Managing Editor
RSM announces two partner promotions

Accounting Firms RSM announces two partner promotions

3w Emma Smith, Managing Editor
Backsourcing: The latest accountancy trend?

Accounting Firms Backsourcing: The latest accountancy trend?

1m Pillsbury Winthrop Shaw Pittman