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$5.5B PwC Trial May Widen Target On Auditors Over Fraud

Law360, Miami (August 3, 2016, 9:59 PM EDT) -- A $5.5 billion trial starting Monday in Miami in which PricewaterhouseCoopers LLP stands accused of missing a massive fraud scheme carried out by the now-bankrupt Taylor Bean & Whitaker Mortgage Corp. could expand how far trustees can hold auditors responsible when such a scheme collapses, attorneys say.

Taylor Bean's trustee is seeking $5.5 billion in damages and argues that PwC was negligent in its audits of the parent company of Colonial Bank, which was used by Taylor Bean executives to carry out the multibillion-dollar fraud that eventually led to the sixth-largest bank collapse in U.S. history. (Credit: AP) In the case,...

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