KPMG Faces Claims of Blown Audit in Private Credit Collapse (1)

Canada’s top securities regulator alleged that KPMG LLP, the auditor for four funds managed by collapsed private lender Bridging Finance Inc., failed to properly value the loans held within the funds, harming investors.

The Ontario Securities Commission claimed in a filing on Tuesday that KPMG falsely represented the quality of the audits it conducted for the 2019 and 2020 fiscal years, and fell short by “failing to consistently challenge and validate audit evidence it gathered.” When KPMG found loans that were overstated, it wrongly assumed the findings were isolated to those loans, the regulator said.

Toronto-based Bridging was ...