SEC charges 69 auditing firms and partners with SOX violation
The Securities and Exchange Commission has issued 69 charges against various accounting firms and partners for violation of a provision of the Sarbanes-Oxley (SOX) Act that requires registration with the Public Company Accounting Oversight Board (PCAOB).
Thirty-seven separate firms were involved in the action. No Big Four or major accounting firms were among those charged. This is the first time the SEC has issued such charges. The SEC indicated that 53 audit reports of public companies were issued by those firms and partners who has not registered as required by SOX.
"They violated one of the key requirements of Sarbanes-Oxley," said SEC Enforcement Director Linda Thomsen about those who failed to register. Thomsen also stated that the actions taken by the SEC, "protect investors and will deter future violations of Sarbanes-Oxley's registration provision."
Fifty of those charged settled on September 13, the day the charges were made. The 28 accounting firms and 22 partners who settled right away were censured by the SEC but not fined. Eighteen of the firms agreed to return a total of $168,150 in audit fees collected from companies that had paid them when they were unregistered.
The firms and partners agreeing to settlements are: Beckman Kirkland & Whitney, James M. Kirkland and Robert J. Whitney; Berger, Apple & Associates and Mitchell S. Seifert; Beutel Accountancy Corp. and Todd W. Beutel; Charles J. Birnberg CPA; Bray & Associates CPAs and Arnold D. Bray; Bujan & Associates and Frank Bujan; Dan Clasby & Co. and Daniel E. Clasby; William E. Costello CPA; Henry L. Creel Co. and Henry L. Creel; Darilek, Butler & Co. and Robert F. Darilek; F.X. Duffy & Co. and Kevin P. Duffy; Sanford H. Feibusch CPA and Sanford H. Feibusch; Forbush & Associates and Daniel J. Forbush; Isaac Gordon CPA; Charles R. Hunt CPA and Charles R. Hunt; Michael C. Lingerman; Joseph Mao CPA; McNeal, Williamson & Co. and Daniel L. Williamson; Milner and Brock CPAs and Stephen D. Milner; Preferred Accounting Services Inc. and Ana Costales; Bruce Redlin CPA; Reed & Taylor CPAs and Robert E. Reed; Henry Schiffer CPA and Henry Schiffer; Randy Simpson CPA and Randy R. Simpson; Andrew M. Smith CPA; Norman Stumacher CPA; United Financial CPA and Anowar Hossain; Harvey S. Weingard CPA; David M. Winings CPA and David M. Winings.
The cases against the other 19 firms and partners are pending. They are: Banker & Co. and Jitendra S. Banker; Choi Dow Ian Hong & Lee Accountancy Corp. and Ernest E. Dow; Michael Deutchman CPA; Halt, Buzas & Powell, Wayne A. Powell and Steven R. Halt; Frederick A. Kaden & Co. and Frederick A. Kaden; Carl S. Sanko CPA; Schuhalter Coughlin & Suozzo and Edward J. Suozzo; Richard E. Sellers CPA and Lester Rex Andersen; Jay J. Shapiro CPA and Jay J. Shapiro; Story & Co. and Brian L. Story.