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List of key players in KPMG fiasco over leaked PCAOB inspection lists

with 3 comments

Three accountants in this story entered the above building innocent and left as a felon. Image courtesy of Adobe Stock.

10/19/20 update:  This list is getting cumbersome to update and read. It has been reformatted and posted here.  This post will not be updated after today. Check the newer post for all future updates.

 

Sometimes you gotta’ have a scorecard to keep track of the players and the story. After a former partner pled guilty this week in the fiasco at KPMG over leaking of PCAOB inspection targets, I had to sort out again who was who.

So, I sketched out a list of the players and a bit of info about each.

Will update this list as the criminal cases move forward.

The roster of players and their status:

Update: More info for Holder added on 10/31/18

Update 3/13/19: Conviction at trial on 3/11/19 for David Middendorf and Jeffrey Wada.

Update 8/9/19:

KPMG:

 

—–

Scott Marcello

Former KPMG partner until ??

Vice Chair of Audit

—–

Not indicted

 

 

David Middendorf

Former KPMG partner until 4/17

National Managing Partner for Audit Quality and Professional Practice Group, in Department of Professional Practice (DPP)

Reported to Marcello

age 55 in 12/19

—–

 

 

1/22/18 – indicted

2/11/19 – scheduled trial date

3/11/19 – convicted on three of four felony counts;

August 2019 – expected sentencing

9/11/19 – Sentencing scheduled – Sentenced to one year plus one day.

1/15/20 – Banned from practice before SEC.

1/16/20 – Has appeal of his conviction underway.

 

 

 

Thomas Whittle

Former KPMG partner until 4/17

National partner-in-charge for Quality Measurement in DPP

Reported to Middendorf

age 56 in 12/19

 

 

 

 

—–

 

1/22/18 – indicted

10/29/18 – guilty plea to five counts (wire fraud and conspiracy)

10/29/18 – agrees to cooperate with government

9/13/19 – scheduled sentencing, postponed

12/20/19 – sentencing scheduled

9/16/20 – still awaiting sentencing

 

 

Chief Auditor

 

—–

Not indicted

 

 

David Britt

Former KPMG partner until 2/17

Co-leader, Banking and Capital Markets Group

Reported to Chief Auditor

age 55 in 12/19

 

 

—–

 

 

1/22/18 – indicted

2/11/19 – scheduled trial date

Update10/19 scheduled trial date; his trial was severed from trial of Mr. Mittendorf and Mr. Wada.

10/3/19 – pleaded guilty to one felony count of conspiracy wire fraud.

5/8/20 – scheduled sentencing

9/16/20 – sentencing is expected on 9/23/20

10/9/20 – no jail time, sentenced to 6 months home confinement, to be served after deportation to his native Australia

 

 

 

Brian Sweet

Former KPMG partner in DPP, 4/15(?) to (?)

Former PCAOB associate director 3/14 to 4/15

age 42 in 12/19

 

—–

1/?/18(?) – guilty plea (conspiracy and wire fraud)

12/20/19 – sentencing scheduled

9/16/20 – still awaiting sentencing

 

 

 

Cynthia Holder

Former KPMG executive director, 8/15 to 4/17

Former PCAOB Inspections Leader, 12/11 to 8/15

 

 

 

 

 

 

 

 

—–

 

1/22/18 – indicted

10/16/18 – guilty plea (4 counts: 2 wire fraud, 1 wire fraud conspiracy, and 1 conspiracy to defraud U.S.)

4/5/19 – scheduled sentencing; prosecutors calculate could be 41 to 51 month sentence; postponed on 4/5/19

6/7/19 – postponed date scheduled for sentencing (per tweet by @TheNewsHam)

8/9/19 – Sentenced to 8 months in prison. Supervised release. Fine of $400. Subject to restitution with amount to be determined.

Bureau of Prisons register number 35321-479.

As of 11/20/19, scheduled release date is 6/30/20.

11/29/19 – Banned from practice before SEC.

As of 1/26/20, scheduled release date is 6/13/20.

6/20/20 – released from custody per Bureau of Prisons

 

Jeffrey Wada,

Former PCAOB Inspections Leader, 2/12 to 2/17

age 44 in 12/19

 

 

 

—–

 

 

1/22/18 – indicted

2/11/19 – scheduled trial date

3/11/19 – convicted on three of four felony counts;

August 2019 – expected sentencing

10/11/19 – Sentenced to 9 months in prison. Restitution to be determined.

12/24/19 – Bureau of Prisons register number 75835-112. Not in custody as of 12/24/19.

1/15/20 – Banned from practice before SEC.

4/6/20 – Not in custody.

9/16/20 – Appealing conviction

 

 

That means the current score is 3 felons, with 3 on deck 3 awaiting trial.

Update 3/13/19: Score is currently 1 on deck awaiting trial and 5 felons (guilty plea for 3, conviction at trial for 2).

Update 10/4/19:  Score is 6 felons, 2 sentenced, 0 yet reported to jail.

Here are the news articles used to compile the above table:

Update: More info for Holder:

Update 10/4/19:

 

More updates:

Written by Jim Ulvog

October 31, 2018, 8:41 am at 8:41 am

Posted in Audits

Tagged with ,

3 Responses

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  1. Comment from Naked Capitalism after linking to post then quoting opening sentence: “Rather a lot of felonies for Big Four auditor, surely?”

    Yes. Yes, it is rather a lot.

    And stop calling me Shirley.

    Jim Ulvog

    October 31, 2018, 11:31 am at 11:31 am

  2. […] Bezzle: “List of key players in KPMG fiasco over leaked PCAOB inspection lists” [Attestation Update]. “Sometimes you gotta’ have a scorecard to keep track of the players and the story. After a […]

  3. […] interested in the ethical failure still want to monitor the status of the players. Previous list, found here, has been reworked since it was getting a bit cumbersome to update and confusing to […]


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