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KPMG and Goldman Sachs are facing criticism in a new lawsuit brought by investors who lost money when SVB Financial Group’s stock value plummeted. The lawsuit alleges that KPMG, which served as SVB’s auditor, and Goldman Sachs, which was the lead underwriter for a stock offering by SVB, made false and misleading statements about the company’s financial health, causing investors to suffer significant losses.
SVB is a bank that specializes in providing financing to startups and venture capital firms. The company had been experiencing significant growth prior to the stock price decline, and had been viewed as a bellwether for the tech industry.
However, in 2018, the company’s stock value plummeted, causing investors to lose millions of dollars.
According to the lawsuit, KPMG failed to properly audit SVB’s financial statements, leading to a failure to identify significant problems with the company’s accounting practices.
The lawsuit alleges that KPMG was aware of these issues but failed to disclose them to investors.
The lawsuit also alleges that Goldman Sachs made false and misleading statements in connection with a stock offering by SVB.
The lawsuit claims that Goldman Sachs knew or should have known that SVB was not performing as well as it claimed, but failed to disclose this information to investors.
The lawsuit seeks to recover damages for investors who lost money as a result of the decline in SVB’s stock value. The lawsuit is still in the early stages, and it remains to be seen how it will be resolved.
In conclusion, the lawsuit over the failure of SVB has resulted in criticism for KPMG and Goldman Sachs. The lawsuit alleges that both companies made false and misleading statements about the company’s financial health, leading to significant losses for investors.
The outcome of the lawsuit remains to be seen, but it serves as a reminder of the importance of transparency and accurate reporting in the financial industry.
