Auditors and accountants regularly call on Wiggin and Dana when faced with claims of malpractice, misrepresentation, fraud, and other professional misconduct. Our lawyers have a strong understanding of the audit process, professional auditing standards, and the roles that different staff members play on an audit. They also understand the legal issues that typically arise in cases involving auditors and accountants. That understanding helps our lawyers formulate appropriate strategies when defending auditors' conduct.
Our in-depth knowledge of the unique issues presented by claims against auditors and accountants allows us to develop creative and cost-effective approaches to resolve them. At the same time, we recognize that the defense of such claims often requires clients to stand on principle. We stand with them and are known for our ability to try cases to successful conclusions, deal effectively with government regulators, and reach reasonable, favorable resolutions of matters when appropriate.
Our experience, careful preparation, and seasoned strategic judgment are why some of the most prominent accounting firms in the country turn to us for counsel in complex matters. The Group has extensive experience representing auditors, accounting firms and their employees in a broad range of matters involving the Securities and Exchange Commission, Department of Justice, Public Company Accounting Oversight Board and state Attorneys General. We have counseled clients at every step of regulatory investigations, including through the SEC's Wells process, in interviews and depositions in civil and criminal matters, and in preparing for and testifying at trials. We have also successfully represented firms and individuals in all aspects of civil cases arising out of government investigations, and in audit malpractice lawsuits.
For example, we represent or have represented:
- Audit partners of a Big Four accounting firm in an SEC investigation relating to the Chinese member firm's audit of a Chinese company.
- An auditor client served with a "Wells" notice indicating the SEC intended to pursue charges against him relating to allegations of improper valuations of illiquid assets. We persuaded the SEC not to bring an enforcement action against him.
- A senior manager of a Big Four accounting firm in a PCAOB investigation relating to audit documentation practices. The matter was resolved without any charges being filed against the senior manager.
- A Big Four accounting firm in a lawsuit alleging malpractice in connection with tax accounting services.
- A Big Four accounting firm in an SEC investigation into whether a large multi-national company made material misrepresentations in its financial statements.
- A partner of a Big Four accounting firm in a DOJ criminal investigation of alleged tax shelters. After an investigation, the DOJ did not bring charges against our client.
- A Big Four accounting firm in a four-year litigation alleging audit malpractice based on the firm's failure to detect embezzlement by its client's controller. The matter ended in a favorable settlement for our client and, during the course of the litigation, we prevailed on two important legal issues in audit malpractice cases.
- A Big Four accounting firm in DOJ and SEC investigations into stock options backdating at the accounting firm's clients.
- A Big Four accounting firm in an investigation conducted by the NY Attorney General, SEC and DOJ into an allegedly fraudulent finite reinsurance transaction. We also represented the same client in additional investigations conducted by the SEC and DOJ into other firm clients' finite reinsurance transactions.
- A Big Four accounting firm in DOJ and SEC investigations, as well as related investor lawsuits filed in Ohio Federal Court, arising out of the firm's audits of National Century Financial Enterprises, an Ohio-based healthcare finance company that was involved in a $3 billion Ponzi scheme. No charges were filed against the firm.
- A manager at a Big Four accounting firm in DOJ and SEC investigations, and in related civil lawsuits, arising out of the collapse of Adelphia Communications. After the SEC issued a Wells notice, the SEC declined to charge our client.
- A Big Four accounting firm in a DOJ False Claims Act investigation related to guaranteed student loans.
- Arthur Anderson in investigations conducted by the CT Attorney General, the CT State Board of Accountancy and in related investor lawsuits arising out of its audits of Colonial Realty Co., a real estate investment company that was involved in a massive Ponzi scheme.
- Arthur Anderson, with co-counsel, in criminal and civil matters arising out of the collapse of Enron, including the federal criminal trial of the firm.