Houston (Oct. 17, 2002) -- Four months after it was convicted by a Houston jury, Arthur Andersen was sentenced Wednesday to probation and a $500,000 fine for its role in the downfall of former audit client Enron Corp.
The sentence was the stiffest one Andersen faced, and doesn’t end the former Big Five firm’s woes. It still faces huge shareholder lawsuits related to Enron’s crash.
The guilty verdict in April on charges of obstruction of justice effectively ended the audit practice of the once mighty Big Five firm, which officially stopped practicing before the Securities and Exchange Commission Aug. 31.
Since it is a corporate conviction, no one in the firm will serve jail time.
According to Andersen attorney Rusty Hardin, the firm, which once reigned as the largest accounting firm in the nation, has downsized to just a few employees to handle existing lawsuits and run an Illinois training facility.
"The company’s over - there’s really not any business left for the judge to restrict," Andersen’s attorney, Rusty Hardin, told the Houston Chronicle prior to the sentencing.
But that won’t stop Hardin or the firm from appealing to the 5th U.S. Circuit Court of Appeals to clear its name "because they were convicted of something they didn't do."
Meanwhile, David Duncan, the former lead Enron auditor who pleaded guilty in April to obstruction, is slated to be sentenced Oct. 25.
- Electronic Accountant Newswire staff
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