Hedge fund investors sue Ernst & Young over fraudulent auditing practices
Five investors who lost millions of dollars following the collapse of a Plano, TX-based hedge fund in 2008 filed a lawsuit against Ernst & Young LLP last week that accuses the Big Four accounting firm of fraud during its time as the fund's auditor. Jason Bramwell reports.
The lawsuit, which was filed August 25 in Houston, claims that New York-based Ernst & Young falsely represented that it fairly audited Parkcentral Capital Management LP. It also claims the auditor failed in its watchdog role to warn investors of the risk of fraud and noncompliance by management.
