SEC Settles with KPMG Canada, Two Partners

The Securities and Exchange Commisson has settled with KPMG Canada and two of its partners for the audit firm's lack of independence related to its audit of Southwestern Water Exploration Co., a now-bankrupt Colorado-based concern.KPMG Canada provided bookkeeping services to Southwestern and then audited its own work, issuing what were supposed to be independent audit reports on Southwestern's financials for the years 1999-2002.The SEC's order censures KPMG Canada without the firm admitting or denying guilt. KPMG Canada also agreed to adopt new auditor independence policies and procedures and pay $73,682 -- its fees for the audit of Southwestern, plus interest.In addition, two KPMG Canada partners -- Gary Bentham, the audit engagement partner, and John Gordon, the concurring and SEC reviewing partner -- are prohibited from auditing SEC issuers for two years and nine months, respectively.