Auditor failure leads to lost investments.
After rounds of mediation, a defendant audit firm agreed to pay $2.5 million to two groups of plaintiffs from a bank holding company and senior executives at a subsidiary bank owned by the bank holding company.
The bank holding company was forced into bankruptcy after the FDIC placed the subsidiary bank into receivership, causing bank executives to lose retirement investments they paid into qualified plans at the subsidiary bank.
Plaintiffs alleged that the bank holding company's auditors, a regional accounting firm, failed to perform an audit of the holding company and subsidiary in compliance with Generally Accepted Auditing Standards, causing the holding company bank to rely on the belief that the subsidiary was on solid financial footing and to raise capital and invest it into a bank that was actually insolvent.
Jim Roberts was lead counsel for the plaintiff.