SEC Fines Ernst & Young $100M Over Auditors Who Cheated On Their CPA Exams

Zinger Key Points
  • EY acknowledged that “a significant number” of its auditors cheated.
  • EY will required retain two separate independent consultants to address the issue.

The accounting giant Ernst & Young LLP (EY) was fined $100 million Tuesday by the U.S. Securities and Exchange Commission (SEC) to settle charges that its audit professionals cheated on the exams required to obtain and maintain Certified Public Accountant (CPA) licenses.

EY was also charged with withholding evidence of this misconduct from the SEC’s Enforcement Division during the investigation into the matter.

What Happened: According to a statement from the SEC, EY acknowledged that “a significant number” of its auditors cheated on the ethics component of CPA exams and various continuing professional education courses required to maintain CPA licenses over multiple years.

The SEC also noted that EY “made a submission conveying to the Division that EY did not have current issues with cheating when, in fact, the firm had been informed of potential cheating on a CPA ethics exam,” adding that the company made no effort to correct its submission even after an internal probe confirmed that cheating was taking place.

See Also: Live Options Trading & Day Trading With Benzinga June 28th

What Else Happened: In addition to its fine, EY will be required retain two separate independent consultants — one to review the firm’s policies and procedures relating to ethics and integrity, and another to review EY’s conduct regarding its disclosure failures.

“The SEC will not permit the submission of misleading information or any action that delays or frustrates our mandate to protect investors and our markets,” said Melissa R. Hodgman, associate director of the SEC’s Enforcement Division.

“Ernst & Young faces significant sanctions and extensive remediation to ensure that its culture and conduct meet the ethical standards required of those responsible for the integrity of our capital markets.

See Also: How Traders Made Huge Profits Using This Systemized Options Trading Strategy with Nic Chahine

Photo: Avi1111/Wikimedia Commons

Posted In: CPAErnst & YoungU.S. Securities and Exchange CommissionGovernmentNewsSEC

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.