E&Y: Cheating on the CPA Ethics Exam?!

Plus Trump's SPAC faces grand jury investigation

Author

Bruce Carton
June 28, 2022

Good morning to everyone who did not cheat on the CPA ethics exam! Here's what's up today.

People

SEC Commissioner Allison Lee, who will be leaving the agency when her term expires at the end of this month, is joining the New York University School of Law as an adjunct professor and senior fellow.

Clips ✂️

Ernst & Young to Pay $100 Million Penalty for Employees Cheating on CPA Ethics Exams and Misleading Investigation

The Securities and Exchange Commission today charged Ernst & Young LLP (EY) for cheating by its audit professionals on exams required to obtain and maintain Certified Public Accountant (CPA) licenses, and for withholding evidence of this misconduct from the SEC’s Enforcement Division during the Division’s investigation of the matter. EY admits the facts underlying the SEC’s charges and agrees to pay a $100 million penalty and undertake extensive remedial measures to fix the firm’s ethical issues.

by SEC Press Release

According to the SEC's Order, "Over multiple years, a significant number of EY audit professionals cheated on these exams by using answer keys and sharing them with their colleagues. From 2017 to 2021, 49 EY audit professionals sent and/or received answer keys to CPA ethics exams."

👉 Cheating on the ethics exam? C'mon man!

SPACs wipe out half of their value as investors lose appetite for risky growth stocks

The proprietary CNBC SPAC Post Deal Index, which is comprised of SPACs that have completed their mergers and taken their target companies public, has fallen nearly 50% this year. The losses more than doubled the S&P 500?s 2022 decline as the equity benchmark fell into a bear market.

Appetite for these speculative, early-stage growth names with little earnings has diminished in the face of rising rates as well as elevated market volatility. Meanwhile, a regulatory crackdown is drying up the pipeline as bankers started to scale back deal-making activities in the space.

by CNBC

Source: Crypto Crash: Hedge Fund 3AC Defaults As Liquidity Dies up Across Sector

Cryptocurrency hedge fund Three Arrow Capital defaulted on a $650 million loan Monday, according to lender Voyager Digital.

The loan is comprised of roughly 15,000 bitcoin and $350 million worth of the stablecoin USDC. The failure to pay is the latest blow to the hedge fund which previously saw a tranche of its positions liquidated by BlockFi and Genesis.

by Business Insider

Trump SPAC faces grand jury investigation

The company that plans to merge with former president Donald Trump’s social media company has received subpoenas from a federal grand jury, a setback that could complicate Trump’s plans to bring his company to the public markets.

The company, known as Digital World Acquisition Corp., revealed the subpoenas in a Securities and Exchange Commission filing dated June 24 and warned they “could materially delay, materially impede, or prevent consummation” of the deal. If the combination goes through, Trump’s business could gain access to more than $1 billion committed by investors.

The grand jury is at least the third investigative entity to scrutinize Trump’s special purpose acquisition company (SPAC) deal, after the SEC and the Financial Industry Regulatory Authority opened investigations of their own.

by The Washington Post

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