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Ernst & Young Can’t Believe Its Luck


Re: Getting off scot-free for telling Lehman Brothers that it could just write all of those things off. So it’s pinching itself, basically appealing the miraculous verdict so that no one can take it away.

The accounting firm late last month sought confirmation of an April decision by an arbitration council, which ruled Ernst & Young wasn't liable for the so-called Repo 105 accounting maneuver that Lehman used to shift assets off its books. The New York Attorney General's office had sued the accounting firm over the practice, which allowed Lehman to temporarily lower its leverage in 2008 while enabling the bank to present itself as financially stronger than it really was.

Ernst & Young Seeks Affirmation of Lehman Accounting Decision [WSJ]