On Monday, KPMG's Chairman and Chief Executive Eugene D. O'Kelly announced that several management changes were being made in the firm's leadership structure.
This announcement comes at a time when the IRS is investigating KPMG as a promoter of potentially abusive tax shelters that cost the U.S. Treasury $1.4 billion. According to a GAO report, tax shelter activities cost the IRS between $11 billion and $15 billion each year between 1993 and 1999.
Among the management changes are:
- Jeff Stein, Deputy Chairman of KPMG LLP, formerly Vice Chair - Tax Services, will retire from the firm effective January 31, 2004. A successor will be elected by the Board and ratified by a vote of the partnership in February.
- Jeff Eischeid has been placed on administrative leave and will no longer serve as partner-in-charge of the Tax Practice's Personal Financial Planning practice. According to Rueters, a KPMG spokesman declined to give further details on Eischeid's departure.
- Richard Smith, who has served as Vice Chair - Tax Services for the past two years, will take on different practice responsibilities. His successor will be named shortly.
A KPMG Statement is below.
KPMG is committed to fill our role as a responsible corporate steward. These changes are consistent with our on-going consideration of the firm's tax practices and procedures, and reaffirm KPMG's commitment to the highest standards of professional practice and responsibility. We look forward to a lasting impact for these decisions, and for our firm to operate in a fully positive, productive, client-oriented environment.