On Dec. 2, 2015, The Securities and Exchange Commission (SEC) announced the settlement with Grant Thornton LLP and two of its partners. The settlement included a forfeit of approximately $1.5 million in audit fees and interest, in addition to a $3 million penalty.

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Hagens Berman successfully represented a whistleblower who brought allegations to the SEC that a leading accounting and audit firm, Grant Thornton LLP, ignored red flags signaling fraud risk while conducting deficient audits of a publicly-traded company our client blew the whistle on. That company and its leadership were subject to an ongoing SEC enforcement action for improper accounting and other practices. 

This important SEC case sent a message that accounting and audit firms can be held liable for failure to diligently audit public companies that are engaged in fraudulent activity. The SEC additionally sanctioned the Grant Thornton partner responsible for the project and deficient auditing. As the SEC stated in announcing settlement of the action: “Audit firms must be held responsible when systemic failures such as inadequate engagement procedures, staffing, or supervision cause the firms’ work to fall significantly short of expected standards, particularly when multiple audits and engagements are involved,” said Andrew J. Ceresney, Director of the SEC’s Division of Enforcement.  “Grant Thornton was aware of red flags suggesting audit quality issues in the audits conducted by one of its engagement partners and its audit quality more generally, but failed to remedy the situation.”

Among other things, Grant Thornton was sanctioned for ignoring red flags in reviewing the books and records of the public company that required independent further investigation.

Our SEC whistleblower client was awarded for his diligent and honorable actions in reporting the fraud at considerable risk.


Hagens Berman is one of a handful of the leading law firms representing successful whistleblowers under the SEC whistleblower program. We were representing SEC whistleblowers even before the first day that the Securities and Exchange Commission’s Dodd-Frank Whistleblower Program launched in the summer of 2011. We beat the odds for our clients, having recovered maximum awards in several record-setting cases. Our current SEC whistleblower cases run the gamut of securities fraud: misrepresentations and omissions in financial filings; accounting fraud; insider trading; market manipulation; market structure and trading violations; pricing fraud; offering fraud; foreign bribery (FCPA); investment fraud; other various other kinds of securities fraud. Our whistleblower legal team represents dozens of SEC whistleblowers around the world in cases currently under investigation by SEC Enforcement Division offices across the country. 


Whistleblower cases are kept under strictly enforced confidentiality by the government or the courts during the period of investigation, and for the SEC/CFTC/IRS programs, in perpetuity. Likewise, whistleblower attorneys at Hagens Berman will handle its investigation and any eventual lawsuit or agency complaint with the highest confidentiality to protect your anonymity. We work to protect your anonymity, confidentiality, and job security during the entirety of our representation. Whistleblower laws protect employees from retaliation and Hagens Berman helps whistleblowers address retaliation and potential retaliation. To understand your rights and the legal protections provided by several whistleblower programs, contact us at [email protected] for a confidential consult.


Hagens Berman’s team of expert whistleblower attorneys, led by managing partner, Steve Berman, and head of whistleblower practice, Shayne Stevenson, has the track record, reputation and knowledge to advocate for whistleblower clients in ways others do not. Our whistleblower practice is among a handful of the most successful and respected in the U.S. Unlike smaller, less experienced whistleblower law firms, Hagens Berman also has more than 80 attorneys in cities worldwide litigating complex corporate fraud every day, giving our clients the resources and expertise necessary to take on a broad range of whistleblower cases.

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