Ex-BDO Partner to Might Go Directly to Jail

DealBook:

"Robert Greisman, 58, of Deerfield, Ill., pleaded guilty in United States District Court in Manhattan. He is the fourth tax partner at BDO Seidman, the accounting and consulting firm, to plead guilty in connection with a federal investigation of tax shelters."

Sentencing on Oct. 23.

As you were.

Ex-Partner at Tax Firm Pleads Guilty in Shelter Case [DealBook/NYT] Sphere: Related Content

PwC India Admits to Not Auditing Satyam

Look, maybe this isn't what it seems. Maybe what Ramesh Rajan, chairman and CEO of PricewaterhouseCoopers, India meant when he told the Central Bureau of Investigation (CBI) that Lovelock & Lewes actually performed audit procedures on Satyam's balance sheet, he meant this:

See, we didn't audit them in this dimension. We totally audited them in a parallel universe where I'm still me and you're still you but Brad Pitt and Jennifer Aniston stay together and that manipulative Angelina doesn't ruin their beautiful perfect relationship. That's the dimension we all want to be in, isn't it?

Oh, and the Times of India also says that the audit fees were deposited into a Pricewaterhouse, Bangalore account but were later transferred to a Lovelock & Lewes account. And there's more:

Apart from Rajan, other senior partners of PW, from Delhi and Kolkata, were also summoned by the CBI last week. The partners denied any association with PW, Bangalore and said that Gopalakrishnan and Talluri [partners in charge of the engagement that are in prison] were not entitled to sign any balance sheet on behalf of PW. "So as it turns out, the auditors who are partners with PW, Bangalore, wrongly signed under the name of PW, and also outsourced the work to Lovelock & Lewes," said sources adding that investigations confirm that the entire auditing team at Satyam is from Lovelock & Lewes.

Good god. There's a lot to process so we'll have Dennis Howlett sum it up:

• PWC were the auditors of record but didn’t do the work
  
• PWC audit partners signed off
  
• PWC received fees and then paid to an associate firm
  
• [B]ut..they didn’t do the work
  
• And, by implication are not therefore to blame AND Lovelock and Lewes are a PWC network consulting firm

Got that? Some might say (and by that we mean pretty much everyone) this might not be so good for P. Dub. Stay tuned.

PWC: ‘We didn’t audit Satyam’ [AccMan]
We didn't audit Satyam: PwC [Times of India]

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Additional Confirmation Why Getting Duped in India is Bad

Last month we told you about the two audit P. Dubya partners that are sitting in an Indian prison because they are accused of being complicit while Satyam just sorta made the numbers up.

You would figure that a couple of auditors spending a few months in prison would be able to make bail and end up on house arrest for their trial. Not so in India, friends.

The judge in the case, has denied bail for the two bean counters:

The court also felt that there is material evidence against the two auditors, who represent Price Waterhouse, for their involvement in the scam. The court also agreed that despite the availability of authenticated documents on various accounting issues in the company, the auditors chose to go by the documents provided by the Satyam management.

So, just in case you're keeping score at home, Allen Stanford may post bail in U.S. and two auditors in India (either crooked as the Satyam management or simply dimwitted, neither so flattering) are going to stay in the joint.

No bail for Satyam auditors: HC [dnaindia.com] Sphere: Related Content

Things Will Turnaround For Us, You'll See...

In case you haven't already noticed, BDO Seidman can't really do anything right.

Not only are they so desperate that they are using the wedding planner defense (oh, wait sorry, that's BDO International, which is completely different and separate from BDO Seidman, totes my fault) against Banco Espirito, now the former Chairman and CEO has been indicted on charges of conspiracy and fraud over his work with tax shelters.

You know, a firm really hasn't had a run like this since Arthur Andersen. Just sayin'.

7 Indicted in Tax Shelter Case [DealBook]
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Prison Population Gets Another Beancounter

Yet another case of a poor accounting schmuck that will spend his retirement using a spork to eat his meals.

Former Vice Chairman of BDO Seidman (not BDO International. I know, it's confusing), Charles W. Bee, Jr. pleaded guilty to helping clients evade over $200M in taxes by using tax shelters.

Bee faces up to 15 years in the clink and he agreed to forfeit $20M and two homes. Ouch.

BDO, in their lameass defense, said that the tax shelter group was dissolved years ago. Thanks for sharing guys.

Guilty Plea for Tax Shelter Fraud in BDO Seidman Case [DealBook] Sphere: Related Content