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KPMG Accounting Scandal

KPMG (Klynveld, Peat, Marwick and Goerdeler) is well known as one of the top 4 accounting firms in the world, "the Big 4"as they are known.

 

KMPG Accounting ScandalBefore the scandal of Arthur Anderson there were known as the big 5.

KPMG Accounting employs over 100,000 people in 148 different countries.

Following in Arthur Andersons footsteps KMPG is now coming to grips with its own KPMG Accounting Scandal.

In 2003, KPMG was under investigation by the U.S. attorneys' office for accounting frad. Now two years later, KPMG has agreed to pay $456 Million to avoid an indictment from the US Department of Justice.

KPMG admitted to setting up fake tax shelters for it's wealthiest clients, which helped them evade paying $2.5 Billion in tax dollars throughout the 1990's. If that wasn't enough, KMPG was accused with the obstruction of justice as investigators tried to piece together the facts of the accounting scandal.

In the face of yet another accounting scandal, by one of the remaining, "Big 4", we see a high profile company getting away with a mere slap on the wrist. KPMG's clients save 2.5 Billion in taxes, in exchange for the firms $456 Million settlement.U.S. Justice Department officials claimed they did not want to indict the firm under these charges because this would have put many of the firms' employees out of work.

While this may indeed be true, it remains a poor reason, to once again let justice slide and provides little incentive for others to remain honest. In fact, this is a win, win situation for KPMG!

 

 

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