PricewaterhouseCoopers Settles MF Global Lawsuit For $65 mln
- Former New Jersey Governor Jon Corzine’s legacy at MF Global costs the auditing firm a small fortune and material reputational damage
According to court documentation, PricewaterhouseCoopers (PwC) has settled a lawsuit with MF Global investors. According to the accusations, the auditor fraudulently deceived investors in the bankrupt brokerage, which at the time was run by former New Jersey Governor Jon Corzine.
Subject to court approval, PwC has agreed to pay $65 million in cash to settle the lawsuit. If approved, the agreement will put an end to class action claims that in 2010 and 2011, PwC has failed to conduct due diligence when certifying that it had properly audited MF Global's financials and internal controls.
According to the accusations in the class action lawsuit the company was aware of the issues which forced MF Global into bankruptcy in October 2011.
the firm stands behind its audit work and its opinions on MF Global's financial statements
Before being put under special administration, the brokerage has been providing contracts for difference (CFDs), foreign Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term and spread betting services to clients. At the time, MF Global filed for bankruptcy protection after a bet made by the company on European sovereign debt paper turned sour.
The financial condition of MF Global substantially deteriorated after the firm made clint money transfers to corporate accounts in order to cover some losses which the brokerage incurred. The company placed leveraged bets on some European sovereign debt government paper.
As the exposure of the company to the market went deeply into the red, MF Global made improper transfers totaling to more than $891 million from Client Money Client Money Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Read this Term funds.
The PwC settlement does not constitute an admission of wrongdoing. The lead plaintiffs in the class action lawsuits are the Virginia Retirement System and the Province of Alberta, Canada.
A spokesperson for the auditing company stated to the media, "PwC is pleased to resolve this matter and avoid the cost and distraction of prolonged securities litigation. The firm stands behind its audit work and its opinions on MF Global's financial statements."
The settlement is not related to a $1 billion lawsuit filed by MF Global's bankruptcy plan administrator which is accusing PwC of professional malpractice.
According to court documentation, PricewaterhouseCoopers (PwC) has settled a lawsuit with MF Global investors. According to the accusations, the auditor fraudulently deceived investors in the bankrupt brokerage, which at the time was run by former New Jersey Governor Jon Corzine.
Subject to court approval, PwC has agreed to pay $65 million in cash to settle the lawsuit. If approved, the agreement will put an end to class action claims that in 2010 and 2011, PwC has failed to conduct due diligence when certifying that it had properly audited MF Global's financials and internal controls.
According to the accusations in the class action lawsuit the company was aware of the issues which forced MF Global into bankruptcy in October 2011.
the firm stands behind its audit work and its opinions on MF Global's financial statements
Before being put under special administration, the brokerage has been providing contracts for difference (CFDs), foreign Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term and spread betting services to clients. At the time, MF Global filed for bankruptcy protection after a bet made by the company on European sovereign debt paper turned sour.
The financial condition of MF Global substantially deteriorated after the firm made clint money transfers to corporate accounts in order to cover some losses which the brokerage incurred. The company placed leveraged bets on some European sovereign debt government paper.
As the exposure of the company to the market went deeply into the red, MF Global made improper transfers totaling to more than $891 million from Client Money Client Money Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Read this Term funds.
The PwC settlement does not constitute an admission of wrongdoing. The lead plaintiffs in the class action lawsuits are the Virginia Retirement System and the Province of Alberta, Canada.
A spokesperson for the auditing company stated to the media, "PwC is pleased to resolve this matter and avoid the cost and distraction of prolonged securities litigation. The firm stands behind its audit work and its opinions on MF Global's financial statements."
The settlement is not related to a $1 billion lawsuit filed by MF Global's bankruptcy plan administrator which is accusing PwC of professional malpractice.