Curse of Arthur Andersen Lives On

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By Jonathan Weil

Whoever said accountants don't have a sense of irony?

Huron Consulting Group Inc., a Chicago-based consulting company founded by a group of former Arthur Andersen LLP partners after the accounting firm's 2002 demise, has agreed to pay $1 million to settle Securities and Exchange Commission allegations that it cooked its books.

The deal caps a remarkable act of corporate self-immolation. One of Huron's main businesses had been providing forensic-accounting advice to other companies, including those under SEC investigation for accounting fraud. Then in 2009 Huron restated more than three years of its financial reports to correct accounting violations, which reduced its earnings by $56 million. The company sold part of its disputes-and-investigations practice in 2010 and shuttered the rest.

The SEC, which disclosed the accord in a press release late Thursday, also reached settlement deals with Huron's former chief financial officer, Gary Burge, and its former chief accounting officer, Wayne Lipski. They agreed to pay almost $300,000 to resolve the SEC's claims against them.

Per the usual formalities, the defendants neither admitted nor denied anything. Unlike the conviction against Arthur Andersen for obstructing the government's investigation of Enron Corp., the SEC's order against Huron in this case won't be overturned.

(Jonathan Weil is a Bloomberg View columnist. Follow him on Twitter.)

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-0- Jul/19/2012 22:34 GMT