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Ernst & Young sued by NY for fraud over Lehman

New York prosecutors sued Ernst & Young, accusing the accounting firm of helping to hide Lehman Brothers Holdings Inc's financial problems, the first major government legal action stemming from the Wall Street bank's 2008 downfall.

The civil fraud case seeks more than $150 million in fees that Ernst & Young received from 2001 to 2008 as Lehman's outside auditor, plus other unspecified damages.

It contends that one of the largest U.S. auditing firms stood by for years while Lehman used accounting gimmickry to create a false impression about its financial health.

Read the Reuters story, "Ernst & Young sued by NY for fraud over Lehman."

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