SEC Charged KPMG Over Xerox Case. The Securities and Exchange Commission has filed civil charges against another KPMG LLP partner, bringing to five the number of partners charged for their roles in auditing Xerox Corp.
According to the agency, it amended its complaint against the firm Friday to add Thomas Yoho for his role in permitting copier giant Xerox to manipulate its accounting to close a “$3 billion gap between actual operating results and results reported to the investing public.”
Between 1997 and 2000, the SEC alleges that the five KPMG auditors falsely represented to the public that their audits were conducted in accordance with generally accepted auditing standards and that Xerox’s financial reports fairly represented the company’s financial condition.
Yoho’s attorney wasn’t immediately available to comment.
Beginning as early as 1997, the SEC said, Xerox used various accounting devices to inflate its equipment sales revenue and earnings.
Xerox settled with the SEC
In April 2002, Stamford, Conn.-based Xerox settled with the SEC without admitting or denying the allegations and agreed to pay $10 million and restate its financial statements.
Yoho, of Greenwich, Conn., participated in the Xerox audit from 1994 until after the 2000 audit was completed, the SEC said.
The agency is seeking an order to bar Yoho and the four other partners from further securities law violations and an order requiring KPMG and the five partners to return all fees for the 1997 through 2000 audits.
The SEC’s original filing against KPMG and four of its partners on Jan. 29. included Michael Conway, Joseph Boyle, Anthony Dolanski and Ronald Safran.