Accounting firm Ernst & Young will pay $ 100 million to settle U.S. Securities and Exchange Commission (SEC) charges that its auditors cheated on Certified Public Accounting (CPA) exams and that cheated the agency researchers.
The London-based auditor admitted the charges and agreed to pay what the SEC said is its largest fine against an auditor.
“EY acknowledges the findings determined by the SEC,” said Brendan Mullin, EY’s media relations director, adding that the company’s response has been “thorough, extensive and effective.”
“At EY, nothing is more important than our integrity and our ethics.”
The CPA is the key qualification for accountants in the United States.
EY has also agreed to “take comprehensive corrective action to address the company’s ethical issues,” the SEC said.
49 people received early test responses
The Wall Street Surveillance Agency found that 49 EY professionals “obtained or circulated” the keys to answering CPA license exams, while hundreds of others cheated to complete the vocational training components. continuous related to CPA ethics.
“This action involves a breach of trust by the guardians … in charge of auditing many of our country’s public companies. It is simply outrageous that the very professionals responsible for engaging customers have cheated on ethics exams,” he said. say Gurbir Grewal, SEC enforcement director. in a statement.
“And it’s equally shocking that Ernst & Young is hindering our investigation of this misconduct,” Grewal added.
EY filed with the SEC that it had no problems with the deception when, in fact, the company had been informed of a possible trap in a CPA ethics exam by a staff member, the SEC said. .
He added that EY admitted that he did not correct his presentation even after an internal investigation by EY confirmed that there had been scams, and even after his senior lawyers discussed the matter with senior management. of the company.
The SEC order also finds that EY violated a Public Company Accounting Oversight Board (PCAOB) rule that required the company to maintain integrity in the provision of a professional service.
The SEC has ordered EY to hire two independent consultants to help correct its shortcomings. One will review the company’s policies and procedures related to ethics and integrity. The other will review EY’s conduct with respect to its disclosure errors, including whether any EY employee has contributed to the company not correcting its misleading presentation, the SEC said.