Bankrupt US auto-parts maker sues auditors

As part of a lawsuit filed against its former chief executive, David
Stockman, 13 others connected with the company and a private equity firm,
bankrupt US auto-parts maker Collins
& Aikman
is suing its former auditors, PricewaterhouseCoopers and

company has alleged
that the two firms violated professional standards and
acted with lack of care.

Stockman and other former company executives are facing criminal charges,
alleging similar misconduct as alleged against the former audit firms. Stockman
and three others have pleaded not guilty in that case.

In it suit filed in the US District Court in Delaware last week, the company
alleged: ‘Defendants concealed the true financial results of operations and
condition of the company, embarking on a fraudulent accounting scheme which
hastened the demise of the company and left it unable to right itself.’

PwC said in a statement it ‘believes its work complied with all professional
standards and intends to defend this case vigorously’ while KPMG said it had not
yet seen the complaint.

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