Ernst & Young To Pay $8.5M Over Fraud Allegations

Law360, New York (December 17, 2009, 6:46 PM EST) -- Ernst & Young LLP will pay $8.5 million to settle allegations that its audit partners failed to catch accounting fraud at Bally Total Fitness Holding Corp., the U.S. Securities and Exchange Commission said Thursday.

The SEC also filed administrative orders against six current and former E&Y partners who allegedly missed millions in transactions Bally improperly booked from 2001 to 2003, when E&Y was the independent auditor of the Chicago-based health club operator.

Like E&Y, the partners all have elected to settle, the SEC said.

The alleged...
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