A federal judge fined accounting firm Andersen $500,000
on yesterday and sentenced it to five years probation
for obstructing justice in a probe of client Enron.
district judge Melinda Harmon handed down the maximum
sentence to the company, which was considered a paragon
of accounting integrity before its disintegration. I
believe a message must be sent to the auditing community
that the destruction of documents will not be tolerated
while an investigation is ongoing, Harmon said.
sentencing comes exactly a year after Enron released a
dismal third-quarter earnings report that sparked its
rapid spiral into bankruptcy and harsh scrutiny of US
corporate accounting practices.
was indicted in March 2002 after it admitted shredding
Enron audit records while a US Securities and Exchange
Commission probe into Enron was underway. To the end,
Andersen maintained that its employees never had any criminal
intent to frustrate federal investigators.