Reply #47: KPMG to admit 'criminal conspiracy' over tax shelters - report

[UpInArms]

http://www.forbes.com/business/feeds/afx/2005/08/28/afx2194128.html

WASHINGTON (AFX) - Accounting firm KPMG LLP will admit Monday to participating in a broad criminal conspiracy over tax shelters the firm sold to wealthy clients until 2002, The Washington Post said.

Citing sources familiar with the deal, the Post said lawyers for KPMG will appear in a New York courtroom Monday morning and admit to the conspiracy.

It said KPMG will pay 46 mln usd and submit its tax unit and compliance efforts to a stringent 16-month review by former Securities and Exchange Commission chairman Richard Breedon.

Despite criticism from the Internal Revenue Service for failing to produce documents during the course of an investigation, KMPG will not face criminal charges for obstructing justice, the report said.

Such a charge could have seen the firms' top clients, including General Electric Co and Citigroup, drop KPMG as an auditor, the Post said.

'KPMG will admit to developing and selling questionable tax deals to hundreds of wealthly clients from 1996 to 2002,' the report said.

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