The U.S. Securities and Exchange Commission (SEC) settled allegations with three accountants, finding that they violated audit oversight rules by sharing answers to their firm’s internal proficiency exams.
The SEC imposed suspensions against three former audit partners at KPMG LLP — Timothy Daly, Michael Bellach and John Donovan — for allegedly sharing answers to internal training exams and covering up their actions.
The trio settled the allegations without admitting or denying their misconduct, agreeing to be suspended for between one and three years from practising before the SEC as an accountant.
As a result of the suspensions, the three men are banned from participating in public companies’ financial reporting and audits.
According to the SEC’s orders, in 2018, the auditors shared images of the questions and answers to a required training exam and deceived KPMG investigators that were looking into possible exam cheating.
“The SEC’s orders find that the former audit partners’ conduct violated a PCAOB rule requiring them to maintain integrity in the performance of a professional service,” the SEC said.
“Audit professionals play a critical role in the integrity of the financial reporting process and the protection of investors,” said Steven Peikin, co-director of the SEC’s enforcement division.
“These actions reflect our commitment to hold these gatekeepers responsible for breaches of their professional obligations,” Peikin added.