Inquiry Assails Accounting Firm in Lender’s Fall
A sweeping five-month investigation into the collapse of one of the nation’s largest subprime lenders points a finger at a possible new culprit in the mortgage mess: the accountants.
Yeah, because accountants are just such edgy law breakers. I suspect the finger (in all senses of the phrase) goes to the boss of the accountants.
There are so many people who did things wrong here, it’s hard to pick just one. In this case, the auditors signed off on some things they shouldn’t have. But they didn’t make the decisions, just agreed they were okay. And that makes them a total failure as auditors, but not exactly the main culprit.
Imagine you’re driving down the road as the sun is going down with your headlights off and you pass a cop. Now the cop really should pull you over, but if he doesn’t and you crash into a tree when the road curves, it’s still your fault. You can blame it on him but you’re the one driving in the dark.
New Century made a whole series of bad choices, some of which may turn out to be illegal. KPMG audited them, and didn’t catch everything. So while KPMG should have caught the problems, it was New Century that created those problems.
I suspect this is far from the last article that will compare this mortgage mess to Enron.