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Tuesday, December 21, 2010

Ernst & Young

Said Cuomo, enforcer of laws,
"The auditor's liable because
The public's reliant
On them that their client
Will tell it the way that it was."   
 


More than two years after the climax of the financial crisis, the first high-profile legal action is not a federal prosecution of one of the failed financial firms, but a fraud case by a state attorney general against an auditor.  New York State Attorney General Andrew Cuomo announced a civil suit against Ernst & Young, former auditor of Lehman Brothers.  The suit alleges that the auditor knew that its client disguised borrowing against assets as sales of those assets, but did nothing to stop the misleading of investors over a period of several years.

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