2023-05-05 12:31:00
Management and accounting consulting company “KPMG” (archive)
Friday 5 May 2023 / 16:31
Two US senators are investigating the relationship of accounting and management consulting firm KPMG with the three recently collapsed US banks, and have asked the firm to submit a wide range of documents for the initial investigation.
Bloomberg news agency reported that House members Richard Blumenthal, a Democrat and Ron Johnson, a Republican, wrote to the company’s CEO, Paul Knopp, last Wednesday, asking him to provide records of “all communications” related to accounting audits and advisory services provided by the company, with a full list of all advisory services. I gave to Silicon Valley, Signature and First Republic banks, which collapsed over the past few weeks.
The senators said in the letter that they are requesting these documents in light of their authority to review all matters related to auditing standards and risk management for financial institutions, as co-chairs of the Permanent Subcommittee on Investigations of the Senate Homeland Security and Governmental Affairs Committee.
It is noteworthy that the United States is facing a serious banking crisis due to the collapse of a number of regional banks, including Silicon Valley Bank, Signature Bank, and First Republic Bank, since the beginning of this year.
The US giant JPMorgan Bank agreed to buy a large majority of the assets of First Republic Bank, and will undertake certain financial obligations of its own, following federal regulators conducted an auction to sell the troubled bank.
The deal includes buying the majority of First Republic’s assets, including regarding $173 billion in loans and regarding $30 billion in securities.
It also includes taking responsibility for deposits of regarding $92 billion, including large bank deposits worth $30 billion, which will be repaid later, or canceled during a rationalization process.
The market value of First Republic Bank fell from more than $40 billion in November 2021 to less than $557 million last Friday.
And last March, the authorities closed the Silicon Valley Bank following its collapse and its failure to compensate for financial losses, in addition to its inability to meet the sudden withdrawals of funds made by its customers, which led to its bankruptcy.
This is the largest collapse of a US bank since the global financial crisis in 2008, which sparked with the bankruptcy of Lehman Brothers. Silicon Valley’s focus on the tech sector might kill startups around the world.
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