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Shoddy PwC Audits Led To Bank Failure, Judge Rules

Law360, New York (January 2, 2018, 2:31 PM EST) -- PricewaterhouseCoopers LLP faces hundreds of millions of dollars in damages after a federal judge recently ruled its negligent audits of an Alabama bank contributed to one of the biggest bank failures of the financial crisis.

PwC had served as the auditor for Colonial BancGroup Inc. and its primary subsidiary, Colonial Bank, and U.S. District Judge Barbara Jacobs Rothstein ruled on Dec. 28 that the accounting giant was negligent in its review of Colonial’s financial statements. That negligence allowed a $2 billion mortgage fraud scheme to take...
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