Jun 01

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Investors Accuse Ernst & Young Accused of Being Complicit in Bribery Scandal

CtW Investments Group (“CtW”), which represents a group of minority shareholders in Wal-Mart, has accused the firm’s external auditor Ernst & Young (“E&Y) of having had early knowledge of Wal-Mart’s violation of the Foreign Corrupt Practices Act related to bribery allegations in Mexico. In a letter to the Public Accounting Oversight Board, CtW reports that Wal-Mart employees informed E&Y in 2006 of an internal investigation into the bribery claims. However, the Securities and Exchange Commission (“SEC”) and other U.S. regulators and investigative agencies were not informed until 2011 when Wal-Mart made disclosures about the internal bribery investigation in its SEC filings.

CtW claims that E&Y’s failure to make an early reporting of the alleged bribery could have misled investors by presenting potentially tainted financial statements.

About the author

Devin Yaeger

Devin Yaeger is a consultant at Fulcrum Inquiry, an accounting, finance and economic consulting firm specializing in complex litigation, forensic investigations and appraisal issues across a broad spectrum of industries.

Permanent link to this article: http://betweenthenumbers.net/2015/06/investors-accuse-ernst-young-accused-of-being-complicit-in-bribery-scandal/

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