Former KPMG partner David Britt has been sentenced to six months of home confinement for his role in a cheating scandal that has haunted the Big Four audit firm for two years and is now finally nearing its end.
On Friday, Judge J. Paul Oetken for the U.S. District Court for the Southern District of New York ordered Britt, a U.S. resident, to be deported to his native Australia to serve his confinement. Britt had faced a maximum sentence of 20 years in prison after pleading guilty to one count of conspiracy to commit wire fraud last October, but a penalty of less than a year had seemed more likely given the sentences handed down to his co-conspirators.
In a statement to Compliance Week regarding the judge’s decision, Melinda Haag, a partner at law firm Orrick and one of the attorneys who represented Britt, said, “We’re grateful for the court’s compassion and understanding.”
Britt, the former co-head of the Banking and Capital Markets Group within the audit group of KPMG’s Department of Professional Practice, and four others were charged by both the Department of Justice and the Securities and Exchange Commission with a scheme to steal confidential inspection planning information from the Public Company Accounting Oversight Board regarding which KPMG audits would be selected for inspection. “Using the playbook he illicitly acquired, Britt used that information to improve the results of his firm’s audits,” said former U.S. Attorney Geoffrey Berman following Britt’s guilty plea.
Britt was the last of the five central KPMG figures at the heart of the cheating scandal to either plead guilty or be found guilty by a jury. The others were David Middendorf, Cynthia Holder, Thomas Whittle, and Brian Sweet. Middendorf was sentenced to one year and one day in federal prison and three years of supervised release for his leading role in the scheme, and Holder was sentenced to eight months in federal prison and two years of supervised release.
KPMG in June 2019 reached a $50 million settlement with the SEC related to the scandal.