Ernst & Young fined $100 million after employees cheated on CPA exams

The Securities and Exchange Commission said Tuesday that “a significant number” of the accounting firm’s auditors cheated on the ethics part of the CPA exam and other courses needed to maintain licenses. Perhaps most surprisingly, the SEC said that Ernst & Young “filed a request” that it had “no current issues with fraud when, in fact, the company was informed of the possibility of fraud in the CPA ethics exam.”

The $100 million fine is the largest ever against an audit firm.

“This action includes a breach of trust by gatekeepers entrusted with auditing several public companies in our country,” Gurbert Grewal, director of enforcement at the SEC, said in a press release. “It is simply disgraceful that the professionals responsible for controlling fraud by clients cheat their ethics exams on everything.”

He added that it was “equally shocking” that they hampered her investigation. “This action should send a clear message that the SEC will not tolerate integrity failures by independent auditors who choose the easiest mistake over the hardest right,” Grewal said.