X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Arthur Andersen agreed to pay $7 million to settle Securities and Exchange Commission charges that the accounting giant filed false and misleading audit reports that overstated Waste Management Inc.’s pre-tax income by more than $1 billion, the federal agency said Tuesday. Without admitting or denying the allegations or findings, Andersen agreed to the first anti-fraud injunction in more than 20 years and the largest-ever civil penalty in an SEC enforcement action against a Big Five accounting firm, the regulatory body said. In connection with its audits of the annual financial statements from 1992 until 1996 of Waste Management, a trash-hauling company, Andersen also agreed to be censured under the SEC’s rules of practice. Three Andersen partners — Walter Cercavschi , Robert G. Kutsenda, Edward G. Maier — and Robert E. Allgyer, a retired partner, also settled charges with the SEC. “Accountants play a critical role in providing access to our capital markets,” Richard H. Walker, the SEC’s enforcement director said in a statement. “We will not shy away from pursuing accountants and accounting firms when they fail to live up to their responsibilities to ensure the integrity of financial reporting process.” In a statement, Terry E. Hatchett, Andersen’s managing partner for North America, said the settlement allows the firm to “close a very difficult chapter” and move on. “We made a business decision to put the matter and the uncertainty of litigation behind us,” he said, adding that the SEC allegations were limited to one client. The annual financial statements were audited for Waste Management prior to its merger in 1998 with USA Waste Services Inc. The Houston, Tex.-based company retained the Waste Management name. In a statement, the company said the officers involved in the falsified and misleading statements are no longer with the company. Copyright (c)2001 TDD, LLC. All rights reserved.

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]

 
Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.

 

ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.