U.S. regulators on Monday charged the Chinese arms of five top accounting firms with securities violations over their refusal to produce certain audit papers, raising questions about whether talks between the United States and China to resolve the issue have stalled.
The Securities and Exchange Commission began proceedings against the Chinese affiliates of Deloitte, KPMG, PricewaterhouseCoopers , BDO and Ernst & Young .
It was the SEC's widest enforcement effort yet to procure documents in connection with probes of possible accounting fraud of U.S.-listed Chinese companies.
The SEC has been seeking documents related to investigations of possible wrongdoing at nine China-based companies, the agency said. Chinese secrecy laws have stymied efforts to obtain audit documents that investigators need to determine whether there were accounting irregularities.
An administrative law judge will schedule a hearing to determine potential sanctions against the Chinese arms of the accounting firms, the SEC said.
In July the agency disclosed it was in discussions with Chinese regulators on cross-border cooperation, including access to documents. The Monday action suggests those talks have not progressed to the SEC's satisfaction.Page 1 of 3 | Next Page