ASSURANCE NEWS

SEC CHARGES FIRM THAT FAKED KPMG AUDIT

Chicago - The Securities and Exchange Commission has filed fraud charges against a health care financial services company after it allegedly provided investors with forged financial statements and audit reports to lure them into a $75 million investment scheme.

Officials of Canopy Financial Inc. allegedy solicited investors by providing them with a falsified audit report purportedly from KPMG, as well as bank and financial statements with false and misleading information. According to the SEC, the fraud came to light when KPMG discovered that Canopy had been claiming that its financial statements for 2007 and 2008 were audited by KPMG. In fact, KPMG had never been retained by Canopy to audit its financial statements and had never opined on the financial condition of the company, and the firm issued a cease-and-desist letter to Canopy.

OVERSTOCK CEO ESCALATES BATTLE WITH GRANT THORNTON

Salt Lake City - The dispute between Overstock.com and its former auditor, Grant Thornton, heated up after the Internet retailer's chief accused the firm of "inconsistencies and inaccurate statements." CEO Patrick Byrne released a letter in response to an SEC filing from Grant Thornton, in which the firm said that it had determined that the company's accounting treatment of an overpayment to a fulfillment partner was in error. "This is a falsehood," Byrne wrote, claiming that Grant Thornton had determined that the treatment was "not unreasonable" - until it got a letter from the SEC on Nov. 3 questioning the treatment.

MADOFF TECHIES CHARGED

Washington, D.C. - The SEC has charged two computer programmers, Jerome O'Hara and George Perez, with helping convicted Ponzi schemer Bernard L. Madoff cover up fraud at his investment advisory firm for more than 15 years, providing the technical support necessary to produce false documents and trading records, and taking hush money to help keep the scheme going.

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