Parkcentral investors sue Ernst and Young 27 August 2010Houston Reporter: Ben Wilkie
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A group of investors who lost money following the collapse of hedge fund Parkcentral have sued auditor Ernst & Young, accusing it of fraud.
The lawsuit, filed in Houston, Texas, alleges that Ernst & Young concealed information and 'facilitated, assisted in and participated in' securities fraud.
"E&Y was supposed to be auditing Parkcentral, but the audited financial statements never once warned Parkcentral's investors of their impending doom," said Demetrios Anaipakos, an attorney for the investors.
"Our clients were informed that their investment in Parkcentral was supposed to preserve capital but instead they lost every penny in record time."
The fund lost over USD2.6 billion, while the investors involved in the lawsuit lost a combined USD17 million.
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