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Deloitte & Touche has reached settlements related to the 2000 audit of Adelphia and the 1998 audit of Just For Feet.

According to a press release, as a condition of the Adelphia settlement, Deloitte & Touche will pay a $25 million penalty, plus a $25 million contribution to a fund to compensate Adelphia shareholders and debt holders. Deloitte & Touche also has agreed on steps for enhancing audit quality for its clients.

As part of the settlement on Just For Feet, there will be a payment of $375,000 to the U.S. Treasury. Neither of the settlements restricts Deloitte & Touche's ability to provide services to new or existing clients.

In both cases, the primary basis of the SEC's claim is that the audits were deficient and failed to uncover fraud committed by the companies and certain members of their management in the face of identified risks.

"Deloitte & Touche LLP shares with the SEC a mutual interest in strengthening investor confidence in the capital markets through the ongoing enhancement of higher quality audits. A key component of this entails continuously developing and applying audit procedures to help in the timely detection of fraud," said Deloitte & Touche USA CEO James Quigley. "These cases raise a larger issue facing the auditing profession. Among our most significant challenges is the early detection of fraud, particularly when the client, its management and others collude specifically to deceive a company's external auditors."

In the case of Adelphia, certain executives were found guilty of fraud, while in the case of Just For Feet, certain executives and third party vendor employees agreed to plead guilty to fraud charges.

Chris is a staff writer for WebProNews. Visit WebProNews for the latest ebusiness news.