While the Securities and Exchange Commission has taken disciplinary action against more than 50 accountants in 2005 and 2006 for misconduct, few have paid compensation to shareholders and nearly half of them continue to hold valid state licenses as CPAs. According to the Associated Press, the regulator shares some of the blame, since it doesn't have an automatic process to notify state accounting regulators of federal disciplinary actions. In several instances, state accounting boards were unaware that a licensee had been disciplined by the SEC. For its part, the SEC said that it refers all disciplinary actions to the relevant state boards.The report pointed out that following the recent settlement where three KPMG partners agreed to pay fines stemming from a $1.2 billion fraud at Xerox Corp, one still holds a CPA license in New York.

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