A former KPMG LLP partner was sentenced to a year and a day in federal prison for his role in eliciting confidential information from the U.S. audit regulator to boost the firm's annual inspection results.
David Middendorf, KPMG's onetime national managing partner for audit quality and professional practice, and Jeffrey Wada, a former inspections leader at the Public Company Accounting Oversight Board (PCAOB), were convicted in March of multiple counts of fraud. Prosecutors said several former employees of the board, including Wada, helped funnel details about its inspection plans to leaders of KPMG, who used the information to change the audits.
Middendorf "was at the top of a chain of corruption that threatened to corrupt KPMG and the PCAOB's inspections process," Geoffrey Berman, the U.S. attorney in Manhattan, said in a statement Wednesday. "Today's sentence recognizes the harm this fraudulent scheme caused to the PCAOB and the auditing profession more generally."
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