KPMG Aided New Century Missteps, Report Says

A court-appointed investigator looking into the collapse of New Century Financial Corp. said in a report that its auditor, KPMG LLP, devised some of the improper accounting strategies that allowed the company to hide its financial problems for years.

The investigator, Michael J. Missal, said the company might be able to recover money for its creditors by suing KPMG for professional negligence and negligent misrepresentation. He also recommended the company sue several of its former top executives to recover millions of dollars in bonuses and other compensation paid to them.

KPMG "contributed to certain of these accounting and financial reporting ...