December 21, 2010 / 4:48 PM / 9 years ago

FACTBOX-Major lawsuits against accounting firms

Dec 21 (Reuters) - Ernst & Young was sued by New York regulators on Tuesday over its role as outside auditor to bankrupt Lehman Brothers Holdings Inc. [ID:nN21125040]

Following are some other high-profile legal cases against accounting firms brought by government authorities, investors or others:

* NEW CENTURY FINANCIAL - KPMG was hit with a $1 billion lawsuit in 2009 by the trustee of bankrupt of New Century, a subprime mortgage lender that collapsed at the start of the U.S. housing crisis. The still-pending lawsuit accused KPMG of helping cover up accounting and financial errors at New Century that led to its collapse.

* TYCO INTERNATIONAL - PricewaterhouseCoopers LLP in 2007 agreed to pay $225 million to settle a class-action case brought by investors in Tyco International Ltd TYC.N following an accounting scandal at the diversified manufacturer.

* XEROX - KPMG in 2006 agreed to pay $22 million to settle U.S. Securities and Exchange Commission charges involving its audits of copier maker Xerox Corp (XRX.N). The SEC said KPMG allowed Xerox to manipulate its accounting from 1997 through 2000.

* TAX SHELTERS - KPMG in 2005 paid $456 million to settle a federal investigation into questionable tax shelters. The settlement, in which KPMG agreed to make internal changes and be overseen by an outside monitor, allowed it to avoid a criminal indictment that might have crippled the firm.

* ADELPHIA - Deloitte & Touche in 2005 agreed to pay $50 million in a settlement with U.S. securities regulators over its role as auditor of bankrupt cable company Adelphia Communications Corp.

* ENRON CORP - Arthur Andersen was convicted in June 2002 of obstruction of justice for its role in the collapse of energy trader Enron. The U.S. Supreme Court overturned the conviction in 2005, but Andersen was virtually out of business by then, felled by a mass client exodus and billions of dollars in lawsuits.

* CENDANT CORP - Ernst & Young in 1999 agreed to pay $335 million to shareholders of Cendant Corp to settle a case stemming from an accounting scandal at the travel and real estate service company. (Reporting by Dena Aubin, editing by Gerald E. McCormick)

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