KPMG and PWC Icelandic offices raided by police

In what can only be described as a deeply embarrassing event: Time is Money is reporting that the Icelandic offices of both KPMG and PWC were raided by 22 police officers and six ‘foreign’ accountants. Apparently, police were looking for papers that might help them determine whether three failed Icelandic banks:

…are [in] “violation of laws on accounting and annual reports, violation of laws on financial institutions and securities transactions and violations of laws on public limited companies”.

More damaging still was the repeat of:

Sigurdur Jonsson, the chief executive of KPMG Iceland, told The Daily Telegraph that the raids related to some of his clients and that none of his staff had been questioned. He refused to comment further on the investigation.

Mr Jonsson has already become embroiled in controversy after it emerged that KPMG Iceland had been responsible for investigating events leading up to the collapse of Glitnir, despite the fact that his son was chief executive of the bank’s largest shareholder. KPMG later resigned from the case.

One has to ask: despite KPMG saying that none of its staff were interviewed, if the police have reason to believe the auditors’ papers might help them then one presumes there will be evidence with potential to link KPMG and PWC to any alleged fraud. The fact Jonsson has already ended up with egg on his face for what must be a clear conflict of interest suggests once again that the brand may mean something but the management is very slack. Is it a case of yet another shoe dropping?

How far any investigation is likely to get remains to be seen. According to an earlier report in Ice News:

It has emerged that the son of Iceland’s Attorney General is one of two CEOs at Exista, which was one of the major stakeholders in Kaupthing Bank. And all cases sent from Iceland’s special banking collapse investigation committee for prosecution have to go through the Attorney General.

Oh well – that’s alright then.

In the meantime: shit>fan>hit anyone?

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Tagged as: Big4 auditors, KPMG Iceland, Pwc