KPMG Takes Responsibility For Illegal Actions
A statement was issued today by accounting firm KPMG LLP taking complete responsibility for the unlawful actions taken by former partners of the firm.
These actions involved offering tax shelter services that are now under criminal investigation by Department of Justice. They are going after KPMG for obstruction of justice and selling abusive tax shelters.
“It has been public knowledge that since February 2004, the Department of Justice has been investigating certain tax services that were offered by the firm during the 1996 – 2002 time period,” said KPMG in the statement. “This is part of a larger tax shelter investigation into the role of accounting firms, law firms, large banks and taxpayers who participated in the development, promotion and implementation of tax shelters.”
“KPMG takes full responsibility for the unlawful conduct by former KPMG partners during that period, and we deeply regret that it occurred,” the firm stated.
KPMG said that it has taken actions to ensure that this type of conduct doesn’t happen again including not offering the services in question, and making sure the people responsible for the illegal actions were removed from the firm.
The firm has also made structural, cultural, and governance changes in order to preserve ethics. KPMG says it has undertaken significant change in its business practices.
“We remain in discussions with the Department of Justice and continue to cooperate fully in its investigation,” said KPMG. “KPMG looks forward to a resolution that recognizes the significant reforms the firm has already made in response to this matter while appropriately sanctioning the firm for this wrongdoing. We take this matter very seriously and seek to resolve it fairly and expeditiously.”
The last time a criminal indictment was brought against a major accounting firm was that of Arthur Andersen. This led to the fall of the firm, but its conviction was recently reversed.