Deloitte opposes SEC move to re-start action seeking China audit papers

Published January 08, 2013

| Reuters

Accounting giant Deloitte has asked a federal judge to reject a request from the U.S. securities regulator to resume a court case in which it is trying to force the auditor to hand over work papers from its audit of an allegedly fraudulent Chinese IT company.

Deloitte Touche Tohmatsu LLP is battling a sub poena from the Securities and Exchange Commission (SEC) to hand over work papers from its audit of Longtop Financial Technologies Ltd. The auditor says it would risk breaking Chinese law by handing the documents over.

The SEC asked for the case to be resumed last month following a six-month hiatus while it tried, but ultimately failed, to reach a diplomatic solution through negotiations with Chinese regulators. The case began in May 2011.

Deloitte filed papers late on Monday, arguing that the case should be postponed pending the outcome of new action taken by the SEC against it and four other audit firms for securities violations related to their refusal to provide Chinese audit documents.

(Reporting by Rachel Armstrong in SINGAPORE; Editing by Daniel Magnowski)

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