EY fired partner for not approving illegal transactions after crystallising "PROFESSIONAL SKEPTICISM,"

KEY HIGHLIGHTS

Former EY partner Sayantani Ghose, an expert in transfer pricing who worked at EY for 16 years, says

• She was forced out of her job for refusing to sign off on client transactions that violated tax and securities laws.
• She believed she would be forced to violate her professional duties if she stayed with the firm.
• EY punished her for exhibiting "PROFESSIONAL SKEPTICISM,"
• She was given negative performance reviews, removed from accounts, and denied promotions for refusing to approve practices that she believed to be unlawful.

The case is Ghose v. Ernst & Young LLP, U.S. District Court for the Southern District of New York, No. 1:22-cv-07881.

• https://fingfx.thomsonreuters.com/gfx/legaldocs/lbvgnkydnpq/EMPLOYMENT_EY_LAWSUIT_complaint.pdf

THE FULL STORY

Ghose, who is represented by lawyers from Wigdor, claims she was forced to resign and then was abruptly fired in January before her planned last day with the firm.

EY, in a statement provided by a spokesperson, said

• Ghose's concerns were fully reviewed and found to lack merit, and
• The U.S. Department of Labor dismissed an administrative complaint by Ghose making retaliation claims.
• "EY will continue to aggressively defend our firm and people against these baseless legal claims,"

Michael Willemin, a lawyer for Ghose, in an email, said

• The Department of Labor "did almost no investigation into this matter."
• Discovery in the lawsuit would give Ghose access to documents and testimony that were never reviewed by DOL.

The DOL did not immediately respond to a request for comment.

New York-based EY has faced numerous claims over the past decade that it encouraged or tolerated misconduct by auditors, including approving unlawful accounting practices in order to win or keep clients.

EY in June agreed to pay $100 million to settle U.S. Securities and Exchange Commission charges that its auditors cheated on certified public accounting exams.

Last year, the firm and three employees settled separate SEC charges that they violated auditor independence rules for $10 million. EY settled similar claims by the SEC in 2016, and a year earlier paid $10 million in a lawsuit by New York state claiming the firm helped Lehman Brothers Holdings Inc deceive investors in the years leading up to its 2008 collapse.

EY in those cases either denied breaking the law or did not admit or deny wrongdoing.

Ghose, an expert in transfer pricing who worked at EY for 16 years, says in her lawsuit that she was given negative performance reviews, removed from accounts, and denied promotions for refusing to approve practices that she believed to be unlawful.

According to the complaint, Ghose notified EY last November that she would be leaving in six months because she believed she would be forced to violate her professional duties if she stayed with the firm.

EY fired Ghose in January and waited more than two months to give consent for her to work for a different accounting firm, she said.

Ghose accused EY of retaliation in violation of the federal Sarbanes-Oxley Act and the Taxpayer First Act. She is seeking monetary, compensatory and punitive damages.

The case is Ghose v. Ernst & Young LLP, U.S. District Court for the Southern District of New York, No. 1:22-cv-07881.

• https://fingfx.thomsonreuters.com/gfx/legaldocs/lbvgnkydnpq/EMPLOYMENT_EY_LAWSUIT_complaint.pdf

SOURCES

• https://www.reuters.com/legal/government/ey-fired-auditor-not-approving-illegal-transactions-says-new-lawsuit-2022-09-15/
• https://www.linkedin.com/posts/mathew-beale-8aa49b1_ey-fired-auditor-for-not-approving-illegal-activity-7023185666926637057-Jjum?utm_source=share&utm_medium=member_ios
• https://fingfx.thomsonreuters.com/gfx/legaldocs/lbvgnkydnpq/EMPLOYMENT_EY_LAWSUIT_complaint.pdf