KPMG LLP reportedly has agreed to pay an undisclosed amount to Anaheim-based Targus Group International Inc. to settle a case stemming from one of Orange County’s largest embezzlement cases ever.
The settlement came after half a year of negotiations, according to Reuters, which reported the settlement on Tuesday.
Targus, a maker of notebook cases and computer accessories, sued KPMG in 2003, several weeks after its former chief financial officer, William Lloyd, was sentenced to 37 months in jail for embezzlement in late 2002.
Lloyd became Targus’ chief financial officer in 1993. Three years later he began to embezzle from the company by using Targus’ cash sources, including lines of credit and depository accounts, to fund personal and business investments unrelated to Targus, according to the company’s suit.
Targus charged KPMG with poor oversight as its accountant, according to court filings. The company didn’t say how much it sought in damages.
Targus alleged it suffered about $50 million in embezzlement-related losses.
Targus said KPMG “negligently and carelessly” performed its services, failing to “employ the skill, prudence and diligence required of them as certified public accountants,” according to an updated version of the complaint filed in late July.
The company also accused KPMG of intentional or reckless disregard for the facts and misrepresenting “important matters” to the board, according to the suit.
New York private equity firm Fenway Partners Inc. bought a majority stake in Targus from Apax Partners LP last year for $383 million.
Business Journal staff reporter Brian Womack contributed to this report.
