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BUSINESS
April 9, 2013 | By Andrew Tangel, This post has been corrected. See note at the bottom for details.
KPMG has resigned as Herbalife's auditor after the auditing firm fired a senior partner in its Los Angeles office because of an alleged insider-trading scheme. "KPMG stated it had concluded it was not independent because of alleged insider trading in Herbalife's securities by one of KPMG's former partners," said Herbalife, the L.A.-based maker and distributor of nutritional foods and supplements.  Herbalife said the former KPMG senior partner was the auditing firm's "engagement partner" on the company's audit.
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BUSINESS
May 1, 2013 | By Stuart Pfeifer, Los Angeles Times
Herbalife Ltd. said it had to scale back plans to repurchase its shares after KPMG resigned in early April as its auditor and withdrew its review of the company's annual financial statements for the last three years. The Los Angeles nutritional products company canceled plans to borrow money that "would have been used to repurchase a meaningful amount of company stock," John DeSimone, Herbalife chief financial officer, told analysts Tuesday in a conference call. KPMG withdrew its approval of Herbalife's 2010, 2011 and 2012 financial statements after the accounting giant accused a senior partner of insider trading in the shares of Herbalife, footwear maker Skechers USA Inc. and other companies.
BUSINESS
May 7, 2013 | By Stuart Pfeifer, Los Angeles Times
A San Fernando Valley jeweler agreed to plead guilty to a conspiracy charge and return nearly $1.3 million in stock-trading gains he made from allegedly illegal tips provided by a former partner at accounting giant KPMG. Bryan Shaw, 52, of Lake Sherwood admitted in a plea agreement that he conspired with KPMG's Scott London to trade in the stocks of the accounting firm's clients. The pair were longtime friends who enjoyed golfing together. In addition to forfeiting his ill-gotten gains, Shaw faces a maximum sentence of five years in federal prison and a fine, the Justice Department said.
BUSINESS
April 9, 2013 | By Andrew Tangel
KPMG, one of the country's biggest auditing firms, has fired a senior partner in its Los Angeles office for allegedly engaging in an insider-trading scheme. The partner passed confidential client information to someone who then traded stocks in several West Coast companies, KPMG said in a statement posted on its website. The partner, whom the firm did not identify, was in charge of KPMG's audit practice in the L.A. office. KPMG said it notified two of its clients it would have to withdraw audits performed for the companies, though it had no reason to believe the reports contained any financial misstatements.
BUSINESS
July 1, 2013 | By Stuart Pfeifer
Moments after pleading guilty to an insider-trading charge, former KPMG partner Scott London struggled to explain the conduct that ruined his career and is very likely to send him to federal prison. “It was probably the worst day of my life,” London said in an interview in the hallway outside the courtroom of U.S. District Judge George H. Wu, who is scheduled to sentence London on Oct. 21. “Imagine what you do, you do it for 30 years, you go to school for it and in a matter of weeks it's all gone,” London said.
BUSINESS
April 11, 2013 | By Walter Hamilton, Andrea Chang and Tiffany Hsu, Los Angeles Times
It's the kind of audacious but small-stakes insider trading that normally wouldn't have merited much attention. Golfing buddies Scott London and Bryan Shaw netted just $1.3 million, a blip in a world where Wall Street kingpins pocket hundreds of millions in ill-gotten gains. The two men made one misstep after another. Their haplessness virtually guaranteed they'd get nailed, experts said. The scope of their ill-fated caper was made clear Thursday when federal prosecutors in Los Angeles filed a criminal charge against London, alleging that he passed insider tips to Shaw from 2010 to 2013.
BUSINESS
April 10, 2013 | By Walter Hamilton, Tiffany Hsu and Andrew Khouri, Los Angeles Times
Scott London, a Los Angeles partner in one of the nation's largest accounting firms, says it began four years ago. By his account, a friend with money trouble was poking around for information on Herbalife Ltd. and Skechers USA Inc., two Los Angeles-area companies whose audits London personally oversaw. Soon, he says, he was passing inside tips on the companies that resulted in as much as $100,000 in profit for his buddy. In return, he says, he collected "about $25,000" in cash, was treated to fancy dinners and received a Rolex watch as a gift.
BUSINESS
August 5, 2011 | By E. Scott Reckard, Los Angeles Times
In the latest legal fallout from the mortgage implosion, Wells Fargo & Co. has agreed to pay $590 million and accounting firm KPMG has agreed to pay $37 million to settle class-action lawsuits centering on controversial "pick-a-pay" loans issued by Oakland's World Savings and later by Wachovia Corp. Wells Fargo disclosed the proposed settlement Friday in a quarterly filing with the Securities and Exchange Commission. If approved by a judge, the deal would settle claims of misrepresentation that investors brought against Wachovia, which acquired World Savings' parent company in 2006 and was taken over in turn by Wells Fargo during the financial crisis.
BUSINESS
April 10, 2004 | From Bloomberg
KPMG did not design an illegal tax evasion scheme for WorldCom Inc. and should be allowed to remain its auditor, the No. 2 U.S. long-distance phone company said in court papers. Several states, led by Massachusetts, want KPMG disqualified as WorldCom's auditor and forced to return $146 million in fees for designing a strategy that helped the company avoid hundreds of millions of dollars in state taxes from 1998 to 2001.
BUSINESS
October 20, 2005 | Kathy M. Kristof, Times Staff Writer
A federal prosecutor Wednesday asked a Los Angeles judge to deny bail to a former KPMG accounting firm partner indicted in a sweeping tax fraud case, calling him a flight risk and a "danger to the community." David Greenberg, 46, was one of 10 former KPMG executives indicted Monday in connection with the design and marketing of alleged phony tax shelters. He was the only defendant to be arrested by authorities. U.S. District Judge Andrew J.
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