Accounting Mistakes

Spokane, WA: (Mar-02-08) The Metropolitan Mortgage & Securities Co. investors' trust had brought charges against PriceWaterhouseCoopers LLC, accusing the accounting firm of having a hand in the financial conglomerate's downfall. The suit stated that PriceWaterhouseCoopers made several accounting mistakes that played a large part in the Spokane company's demise. In filing suit, the investors' trust alleged the accounting firm violated its duty as independent auditor in 1999 and 2000. The trust claimed PriceWaterhouse helped Metropolitan hide significant financial failings and its poor preparation to enter the high-risk commercial lending business. It stated that PriceWaterhouse concocted an offshore investment scheme that turned out to be a cleverly disguised tax shelter for Metropolitan, which wound up falling apart under an Internal Revenue Service crackdown. Most of the trust's case relied on steps the Metropolitan board of directors said they would have taken had the PriceWaterhouse audits reflected the true financial condition of the company. Board members said they likely would have hired a turnaround specialist. The trust argued that such a specialist would have curtailed spending and sold insurance affiliates, perhaps raising enough money to keep the company solvent.

As part of a settlement reached, the Metropolitan Mortgage & Securities Co. investors' trust has agreed to a $30 million settlement with PriceWaterhouse, resolving the lawsuit. Spokespersons stated that the settlement marks the first time that PriceWaterhouseCoopers LLC has agreed to pay for its role in the Spokane company's demise. [SEATTLE POST INTELLIGENCER: PWC SETTLEMENT]

Legal Help

If you have a similar problem and would like to be contacted by a lawyer at no cost or obligation, please click the link below.

Please click here for a free evaluation of your claim

Published on Mar-3-08