SEC Charges Ernst & Young and Six Partners for Roles in Accounting Violations at Bally Total Fitness
Source: U.S. Securities and Exchange Commission

The Securities and Exchange Commission today charged Ernst & Young LLP and six of its current and former partners, including three who are members of the firm’s national office, for their roles relating to an accounting fraud at Bally Total Fitness Holding Corporation. The SEC finds that E&Y knew or should have known about Bally’s fraudulent financial accounting and disclosures.

The SEC finds that E&Y issued unqualified audit opinions stating that Bally’s 2001 to 2003 financial statements were presented in conformity with Generally Accepted Accounting Principles and that E&Y’s audits were conducted in accordance with Generally Accepted Auditing Standards. These opinions were false and misleading.

E&Y, which was the independent auditor of the Chicago-based operator of fitness centers, has agreed to pay $8.5 million to settle the SEC’s charges. Each of the E&Y partners also has settled the SEC’s charges against them.

Related documents in PDF

This entry was posted on Monday, December 21st, 2009 at 4:34 am and is filed under Business and economics, Government and politics, Legal and law enforcement. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.