BDO Settles Suit Over Faulty Audit Of Subprime Lender

Law360, New York (July 27, 2011, 2:25 PM EDT) -- Auditing firm BDO USA LLP on Tuesday resolved for $175,000 a proposed class action brought in Pennsylvania federal court by American Business Financial Services Inc. investors alleging they relied on the firm's faulty review of the failed subprime lender's financial reports.

In exchange, the plaintiffs agreed to drop its claims against BDO, but its claims against other defendants linked to ABSF's demise will be allowed to continue under the settlement, approved by U.S. District Judge Thomas N. O'Neill. Among the other defendants are ABSF's indenture trustees...
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