- POSTED: 19 Aug 2014 06:27
New York state on Monday (Aug 18) fined Pricewaterhouse Coopers US$25 million (S$31 million) and suspended some consulting work for two years after finding the company hid a Japanese bank's US sanctions violations.
NEW YORK: New York state on Monday (Aug 18) fined Pricewaterhouse Coopers US$25 million (S$31 million) and suspended some consulting work for two years after finding the company hid a Japanese bank's US sanctions violations.
Bank of Tokyo-Mitsubishi UFJ, Japan's biggest lender, pressured PwC to scrub a report on wire transfers the bank submitted to regulators to hide its dealings with blacklisted Iran, Myanmar and Sudan, the New York State Department of Financial Services said.
"Under pressure from BTMU executives, PwC removed a warning in an ostensibly 'objective' report to regulators surrounding the bank's scheme to falsify wire transfer information for Iran, Sudan, and other sanctioned entities," the department said.
Under the terms of the settlement, PwC's Regulatory Advisory Services unit will be suspended for 24 months from accepting consulting work at financial institutions regulated by the New York state agency and undertake a series of reforms.
Benjamin Lawsky, the superintendent of Financial Services, said this was the latest case of improper influence and misconduct in the bank consulting industry, which had a "troubling web of conflicts."
In 2013, the DFS reached a similar settlement with Deloitte Financial Advisory Services that involved a 12-month suspension of consulting activities.
"When bank executives pressure a consultant to whitewash a supposedly 'objective' report to regulators - and the consultant goes along with it - that can strike at the very heart of our system of prudential oversight," Lawsky said.