PwC is scheduled to go to trial for malpractice related to the bankruptcy of SemGroup in August, almost six years later. The SemGroup Litigation Trust, pursuing claims on behalf of the company and its creditors, alleges PwC did a terrible audit. But it’s worse than just lousy auditing, especially if a trial exposes the truth of PwC’s disingenuous defenses.
Pete Brush at Law.com did a story last week about a story about in pari delicto, the adverse interest exception, and holding third-parties like auditors liable for fraud in bankruptcy cases. I was quoted.
My Friday, August 10 column at American Banker is a review of Neil Barofsky’s book, “Bailout: An Inside Account of How Washington Abandoned Man Street While Rescuing Wall Street.”
Lots of news and updates on MF Global, PricewaterhouseCoopers, JP Morgan, Jamie Dimon and the politics of money.
Almost everyone wondering where the missing MF Global customer assets have gone thinks they will show up eventually. I believe the assets are long gone.
The New York Court of Appeals decided on October 21, 2010, by a vote of 4-3, to “decline to alter our precedent relating to in pari delicto, and imputation and the adverse interest exception, as we would have to do to bring about the expansion of third-party liability sought by plaintiffs here.”
The decision is flawed, misguided and strongly biased towards corporate interests rather than shareholder and investor interests.