“Judge disqualified for unusual conflict prior to bench” —

• “Justice Cameron Moore stepped away from the Greensill Bank AG v Insurance Australia Limited proceedings after concerns were raised about his involvement in the matter prior to his appointment.”
• “In his recent judgment, Justice Moore explained he appeared as senior counsel for one of the parties in November 2024 – just a month before his appointment to the bench – on an interlocutory application concerning the Harman obligation.”
• “While the issue itself was not for determination, or had any direct bearing, in the substantive hearing, the application was ‘collateral’.”
• “‘I was briefed on that application because both senior counsel briefed for the Marsh [Limited and Marsh Pty] entities in the proceedings were unavailable on the date set down for the hearing of the Harman application. I was not briefed in the matter generally,’ he said.”
• “In January this year, after the proceedings were allocated to Justice Moore, he said he considered whether his involvement in the Harman application would prevent him from the allocation.”
• “Justice Moore said that the fact a judge may have appeared in the same matter they presided over ‘does not of itself necessarily give rise to a reasonable apprehension of bias’, nor would the mere identification of the issues during an interlocutory dispute.”
• “On the face of the matter, Justice Moore said his prior involvement would not necessarily require his disqualification.”
• “‘However, the [Greensill] parties contend the submissions advanced by me on behalf of the Marsh entities went further than merely identifying uncontroversial issues in the proceedings and suggested how those issues might be approached and resolved,’ he said.”
• “Having reviewed the material provided by Greensill, Justice Moore said he agreed certain passages ‘went further and were suggestive of a particular outcome on issues’ that require resolution in the substantive proceedings and interlocutory issues.”
• “‘In those circumstances, a fair-minded lay observer might reasonably apprehend that I might not bring an impartial mind to the resolution of those issues, and I am satisfied that I ought to recuse myself from further involvement in the proceedings,’ Justice Moore said.”

“Treasury Department Announces Suspension of Enforcement of Corporate Transparency Act Against U.S. Citizens and Domestic Reporting Companies” —

• “The Treasury Department is announcing today that, with respect to the Corporate Transparency Act, not only will it not enforce any penalties or fines associated with the beneficial ownership information reporting rule under the existing regulatory deadlines, but it will further not enforce any penalties or fines against U.S. citizens or domestic reporting companies or their beneficial owners after the forthcoming rule changes take effect either.”
• “The Treasury Department will further be issuing a proposed rulemaking that will narrow the scope of the rule to foreign reporting companies only. Treasury takes this step in the interest of supporting hard-working American taxpayers and small businesses and ensuring that the rule is appropriately tailored to advance the public interest.”
• “‘This is a victory for common sense,’ said U.S. Secretary of the Treasury Scott Bessent. ‘Today’s action is part of President Trump’s bold agenda to unleash American prosperity by reining in burdensome regulations, in particular for small businesses that are the backbone of the American economy.'”

“KPMG Must Pivot Around Audit Clients in Creating US Law Practice” —

• “KPMG must overcome a prohibition against giving legal advice to audit clients as it becomes the first Big Four accounting firm to practice law in the US.”
• “The prohibition stops the company from gaining potential legal customers from the hundreds of Fortune 500 and privately held companies it audits. KPMG agreed to the limitation to win Arizona Supreme Court approval Thursday to practice law in the state.”
• “‘This is the biggest challenge when you’re dealing with the Big Four—they have conflicts,’ said Howard Rosenberg, head of talent intelligence and acquisition at Baretz + Brunelle. A prohibition against accounting firms providing consulting and auditing services under the same roof prompted, in part, EY to scrap the spin-off of its consulting business in 2023.”
• “KPMG said it never planned to offer legal services to audit clients. The firm will apply the service restriction to both its public company and privately held audit clients, including those served by affiliates around the globe. Rather than shedding clients to comply with the order, the firm said it expects to gain ‘many’ customers as a result of being able to practice law in Arizona.”
• “KPMG has said it seeks to provide services to multinational corporations that largely complement the work of traditional law firms, such as harmonize thousands of legal contracts as part of post-merger integration or help re-orient supply chains.”
• “US auditor independence rules generally bar accountants from acting on behalf of company managers and US securities laws specifically prohibit auditors from providing legal services to their publicly traded clients.”
• “The Arizona high court’s decision extends that logic to prevent possible conflicts of interest, said Robert Knechel, director of the International Accounting and Auditing Center and accounting professor at the University of Florida. ‘Law is by definition an advocacy service, and auditing is not,’ Knechel said.”
• “The Arizona court’s decision ‘still leaves open a wide market of non-audit clients to sell services to,’ said Tom White, a retired Wilmer Hale partner and lecturer at Columbia Law School.”
• “Over the past two decades, the Big Four have amassed lucrative consulting arms despite strict conflict-of-interest rules set after accounting scandals toppled Enron Corp. and WorldCom Inc. and now policed by the Securities and Exchange Commission. KPMG’s US advisory business generated roughly 40% of the firm’s $12.6 billion in revenue in 2024.”
• “As an Arizona alternative business structure, KPMG will have an internal compliance watchdog, said Natalie Knowlton, associate director for legal innovation for Stanford Law School. This watchdog, identified by KPMG Law US as longtime KPMG attorney David Rizzo, will be required to comply with Arizona’s requirement to file compliance reports twice a year.”
• “‘This is a much more heavily regulated environment than any other jurisdiction in the US,’ Knowlton said. ‘There’s a compliance lawyer who is required to report to the bar in case there are any incidences of malfeasance or any lawyers have gone outside of the boundaries the court has set up. You don’t see that in any other law firms.'”