Justice Dept Joins Lawsuit Against KPMG

The Justice Department has joined a lawsuit alleging that KPMG helped a client defraud the American government through submitting bogus expense claims, reports the New York Times.

The whistle-blower suit sees the accounting firm accused of assisting the Columbia/HCA Healthcare Corporation in misrepresenting costs associated with patient care, so as to receive payment for costs that were not eligible for reimbursement.

A former Columbia employee claimed that KPMG helped some Florida hospitals owned by Columbia set up secret reserves, which were kept in case government auditors discovered the scheme.

Now the Justice Department is to join in with the case. Legal experts reportedly believe that this could be the first time that the government has held an accounting firm liable under the whistle-blower statute for taking part in the fraudulent actions of a client.

A KPMG spokesperson denied that the firm was engaged in any wrongdoing.

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