emails that come back to haunt


Years ago, my former employer, KPMG, agreed to a half-billion (with a B) dollar fine, to avoid criminal prosecution that could have destroyed the firm. The fine was for tax shelters sold by the firm to wealthy individuals in the late 1990's. Two of my favorite quotes that came out of the internal e-mails publicized in the investigation:

"We are dealing with ruthless execution, hand-to-hand combat, blocking and tackling. Whatever the mixed metaphor, let's just do it."

"My own recommendation is that we should be paid a lot of money here for our opinion since the transaction is clearly one that the IRS would view as falling squarely within the tax shelter orbit."

All of the Big-5 firms engaged in these tax shelters (PwC called them an "institutional failure"). The difference between how the firms handled them was the key to the fallout.  KPMG decided to fight the government, and they lost.

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