Liberty Mutual Sues Contractor's CPA Over $50M Losses

Law360, Houston (April 8, 2013, 3:05 PM EDT) -- Liberty Mutual Insurance Co. on Friday alleged in Texas federal court that shoddy accounting by Padgett Stratemann & Co. LP led the insurer to bond construction projects valued at $50 million that were abandoned after the general contractor went bankrupt.

The insurer claims that it never would have bonded 37 projects across Texas on behalf of Ballenger Construction Co., which filed for bankruptcy last year, had it known its true financial condition, which was obscured by an inaccurate audit Padgett performed in 2011.

“Padgett failed to...
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