{"id":5593,"date":"2016-10-24T12:23:12","date_gmt":"2016-10-24T16:23:12","guid":{"rendered":"https:\/\/www.khflaw.com\/news\/?p=5593"},"modified":"2020-09-25T10:51:01","modified_gmt":"2020-09-25T14:51:01","slug":"accountants-no-duty-care-toward-third-party-investors","status":"publish","type":"post","link":"https:\/\/www.khflaw.com\/news\/accountants-no-duty-care-toward-third-party-investors\/","title":{"rendered":"Accountants Have No Duty of Care Toward Third-Party Investors, or Do They?"},"content":{"rendered":"<p>In 2001, Anderson was one of the &#8220;Big Five&#8221; public accounting firms. Founded by Arthur Anderson, whose motto was &#8220;think straight, talk straight.&#8221; The Anderson firm was one of the most respected accounting firms in the world. A year later, Anderson was found guilty of obstructing justice for destroying Enron&#8217;s financial documents. Anderson shut its doors in the United States that same year and surrendered its licenses to practice certified public accounting. A few years later, Anderson settled with various Enron investors who brought claims against Anderson for its role in the Enron fraud. Since the Enron\/Anderson scandal, the law relating to an accountant&#8217;s duty to nonclients has changed.<\/p>\n<div class=\"content-wrapper\">\n<div id=\"articlebody\">\n<div id=\"page-container\" class=\"container\">\n<div class=\"main-container main-wrapper\">\n<div class=\"row\">\n<div class=\"span8 left-container\">\n<article>\n<div class=\"row main-page-div\">\n<div class=\"span7 stalkerOffset \">\n<div class=\"article-text basic-article-text\">\n<div id=\"temisReplace\">\nTraditionally, an accountant owes no duty to a nonclient. For instance, an accountant who prepares a financial statement containing material misrepresentation would not be liable to a nonclient, such as a bank, who relied on the financial statement to its detriment. As seen in the Enron\/Anderson case, however, the landscape of accountant liability is changing. If the accountant aided in the commission of the fraud, or where the accountant knew the third-party nonclient (e.g., a bank) would be relying on the statements, the accountant may be liable to the nonclient.<\/p>\n<h2 class=\"subhead\">Aiding and Abetting a Fraud<\/h2>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"read_more_link\"><a href=\"https:\/\/www.khflaw.com\/news\/accountants-no-duty-care-toward-third-party-investors\/\"  title=\"Continue Reading Accountants Have No Duty of Care Toward Third-Party Investors, or Do They?\" class=\"more-link\">Continue reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"<p>In 2001, Anderson was one of the &#8220;Big Five&#8221; public accounting firms. Founded by Arthur Anderson, whose motto was &#8220;think straight, talk straight.&#8221; The Anderson firm was one of the most respected accounting firms in the world. A year later, Anderson was found guilty of obstructing justice for destroying Enron&#8217;s financial documents. Anderson shut its [&hellip;]<\/p>\n","protected":false},"author":12,"featured_media":5011,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[414],"tags":[143],"coauthors":[535],"class_list":["post-5593","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-publications","tag-edward-t-kang","publication_lawyer-edward-t-kang"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Accountants Have No Duty of Care Toward Third-Party Investors, or Do They? &#8212; Kang Haggerty News &#8212; October 24, 2016<\/title>\n<meta name=\"description\" content=\"In 2001, Anderson was one of the &quot;Big Five&quot; public accounting firms. Founded by Arthur Anderson, whose motto was &quot;think straight, talk straight.&quot; The &#8212; October 24, 2016\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.khflaw.com\/news\/accountants-no-duty-care-toward-third-party-investors\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Accountants Have No Duty of Care Toward Third-Party Investors, or Do They? &#8212; Kang Haggerty News &#8212; October 24, 2016\" \/>\n<meta property=\"og:description\" content=\"In 2001, Anderson was one of the &quot;Big Five&quot; public accounting firms. Founded by Arthur Anderson, whose motto was &quot;think straight, talk straight.&quot; The &#8212; October 24, 2016\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.khflaw.com\/news\/accountants-no-duty-care-toward-third-party-investors\/\" \/>\n<meta property=\"og:site_name\" content=\"Kang Haggerty News\" \/>\n<meta property=\"article:published_time\" content=\"2016-10-24T16:23:12+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2020-09-25T14:51:01+00:00\" \/>\n<meta property=\"og:image\" content=\"http:\/\/localhost\/news\/wp-content\/uploads\/2017\/08\/6114470_l.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"2546\" \/>\n\t<meta property=\"og:image:height\" content=\"1647\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Edward T. 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Founded by Arthur Anderson, whose motto was \"think straight, talk straight.\" The &#8212; October 24, 2016","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.khflaw.com\/news\/accountants-no-duty-care-toward-third-party-investors\/","og_locale":"en_US","og_type":"article","og_title":"Accountants Have No Duty of Care Toward Third-Party Investors, or Do They? &#8212; Kang Haggerty News &#8212; October 24, 2016","og_description":"In 2001, Anderson was one of the \"Big Five\" public accounting firms. Founded by Arthur Anderson, whose motto was \"think straight, talk straight.\" The &#8212; October 24, 2016","og_url":"https:\/\/www.khflaw.com\/news\/accountants-no-duty-care-toward-third-party-investors\/","og_site_name":"Kang Haggerty News","article_published_time":"2016-10-24T16:23:12+00:00","article_modified_time":"2020-09-25T14:51:01+00:00","og_image":[{"width":2546,"height":1647,"url":"http:\/\/localhost\/news\/wp-content\/uploads\/2017\/08\/6114470_l.jpg","type":"image\/jpeg"}],"author":"Edward T. Kang","twitter_card":"summary_large_image","twitter_misc":{"Written by":"Edward T. Kang","Est. reading time":"7 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.khflaw.com\/news\/accountants-no-duty-care-toward-third-party-investors\/#article","isPartOf":{"@id":"https:\/\/www.khflaw.com\/news\/accountants-no-duty-care-toward-third-party-investors\/"},"author":{"name":"Edward T. 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