Deloitte has sued Thomas P. Flanagan, a 30-year partner in the firm, for allegedly trading on inside information he received from audits and lying about it for years. Courthouse News reports that Deloitte filed its case in Chancery Court in Delaware.
According to the Courthouse News article,
Flanagan “for 30 years was a partner” in Deloitte & Touche or a predecessor “until his abrupt resignation less than two months ago,” Deloitte claims. It says he betrayed his trust and violated company policy by trading in securities of audit clients, including some of his own accounts, since 2005.
“Compounding his wrongdoing, Flanagan repeatedly lied to Deloitte about his clandestine trading activities in annual written certifications, going to far as to conceal the existence of a number of his brokerage accounts to avoid detection of his improper conduct,” Deloitte says. It says that both Deloitte and its clients have had to pay legal costs to investigate Deloitte’s ability to continue as independent auditor, due to Flanagan’s shenanigans. It seeks monetary damages.
Deloitte says that it still does not know the extent of Flanagan’s profits from his alleged trades.