KPMG LLP will pay about $450 million and open up its operations to independent review as part of a deal with federal prosecutors to avoid a criminal indictment that could have sent the nation’s fourth-largest accounting firm into a death spiral, according to sources familiar with the pact.
The deal, struck with the U.S. attorney for the Southern District of New York after weeks of intense negotiation, is expected to be presented for a judge’s approval Monday.
At the same time, federal prosecutors are also expected to unveil criminal charges against multiple former KPMG partners, including several who once occupied senior-level management positions at the firm, the sources said. Legal and tax advisers at other companies also could be charged for their role in the deals, which lawmakers estimate were used to shelter more than $1.4 billion from tax collectors.
