It was the
The defining moment in the KPMG insider-trading scandal happened over coffee at a Starbucks in the San Fernando Valley, when the auditor at the center of the case was set up by his longtime friend.
Accountant Scott London thought he was meeting for a casual coffee, until the friend handed him an envelope containing $5,000 cash — a payoff for giving his buddy inside information about public companies that KPMG audited.
Unbeknownst to London, the
A few days later, FBI agents showed up at London's Agoura Hills home with the photographs. They told him to hire a lawyer.
London would later admit to KPMG that he had been providing the friend with information about two of the accounting powerhouse’s clients:
KPMG fired London and resigned as auditor for Herbalife and Skechers. The companies are now scrambling to retain new accountants. And London is awaiting the next step — a likely criminal prosecution and regulatory enforcement.
In an interview with The Times, London declined to identify his friend.
London, 50, has been a certified public accountant since 1986. He had a high-paying job, managing hundreds of KPMG accountants.
He said he gave the friend information about the companies because he wanted to help out a friend who was struggling financially. The friend rewarded him with about $25,000 in cash payments, a new Rolex watch and fancy dinners, London said.
"I have no idea what I was thinking. I don't know why there was a lapse of judgment, but there was," he said.