A federal judge on Wednesday ordered PricewaterhouseCoopers to face a $1 billion lawsuit claiming that its bad accounting advice was a substantial cause of the October 2011 bankruptcy of MF Global Holdings Ltd, a brokerage run by former New Jersey Governor Jon Corzine. U.S. District Judge Victor Marrero in Manhattan said PwC’s advice on “repurchase-to-maturity” transactions through which Corzine bought $6.3 billion of European sovereign debt affected how MF Global implemented its strategy and in turn contributed to its alleged losses. “This line of causation gives rise to a plausible claim that PwC proximately caused harm to MF Global,” Marrero wrote. MF Global’s bankruptcy plan administrator sued PwC on March 28, accusing it of professional malpractice for having provided “flatly erroneous” accounting advice to the company. Corzine is not a defendant. [Reuters]

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  1. Posted by guest | August 27, 2014 at 5:50 PM

    damn the accountants!

  2. Posted by UFO | August 28, 2014 at 4:34 PM

    In related news, PWC is offering to disclose exactly how cooked the books are as well as evidence that Corzine (A) disregarded MFG' risk protocols and (B) ordered the commingling of funds. PWC this information release has nothing to do with the ongoing lawsuit.

    - guy who knows better than to throw your accountant under the bus.