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  1. Business
12 April 2013updated 22 Oct 2020 3:55pm

Five questions answered on the KPMG scandal

Scott London has been accused of insider trading.

By Heidi Vella

A senior partner at accountancy firm KPMG is facing criminal and civil charges for insider trading. We answer five questions about the case.

What exactly has the KPMG partner been accused of?

KPMG employee, Scott London, has been accused of insider trading by passing on information to a golfing friend, who then traded share tips.

What evidence are the allegations based on?

It is believed Los Angeles based London was secretly recorded by investigators passing on information to jeweller friend Bryan Shaw.

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According to the filing, London told Shaw about a merger between KPMG’s client RSC Holdings and United Rentals, as well as about another takeover of Pacific Capital Bancorp by Union Bank.

It is alleged that Mr London received cash in exchange for the tips offs.

How were authorities alerted to London’s alleged illegal activities?

There’s speculation that they were first alerted to his alleged insider trading after Shaw’s stockbroker noticed unusual share trading patterns.

What have KPMG said about the allegations?

KPMG immediately separated the firm from London and in a statement published on the BBC said:

“This individual violated the firm’s rigorous policies and protections, betrayed the trust of clients as well as colleagues, and acted with deliberate disregard for KPMG’s long-standing culture of professionalism and integrity.”

What effect has this had on KPMG?

The audit company this week resigned as auditor to US companies Herbalife and Skechers when the allegations came to light.

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  • Facility / Grounds Management and Maintenance
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  • Health - Medical and Nursing Management
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  • Public Relations and Media
  • Purchasing and Procurement
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  • Science and Technical Research and Development
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Visit our privacy Policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.
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