PwC settles lawsuit with subprime lender [FT]
Creditors of Cattles sued PwC in 2013, stemming from the latter's '06 and '07 audits. Things went south and Cattles went into restructuring in 2011 and sued PwC in 2013. Since then, the firm "stood behind its work" and "vigorously defending" itself up until the parties settled for an undisclosed amount yesterday.
American Airlines’ Reservations Test: Smooth Travel This Weekend [WSJ]
If you're flying this weekend, godspeed:
The world’s biggest airline faces its biggest merger-integration test this weekend, when American Airlines Group Inc. shifts its US Airways unit onto its reservation system.
The new American has been preparing since it was formed 22 months ago for the complex information-technology fusion, a step that has gone poorly for some rivals. United Continental Holdings Inc., which merged in 2010 and made the system transition in early 2012, disrupted passengers and employees alike for weeks. US Airways and America West Airlines, which linked up in 2005, executed poorly on their IT transition two years later.
A private citizen suspects someone is cheating on his taxes. That person brings what is known as a qui tam lawsuit (because we are lawyers, we must use terms that ordinary people don't understand). The suit is filed under the False Claims Act. If the suit is successful and the private citizen can show the taxpayer was cheating, that private citizen gets to keep a portion of the tax and penalties. Ten states have authorized tax-related private lawsuits in some manner.
On the one hand, it's silly to think that regular people could have any basis whatsoever for suspecting that their neighbors cheat on their tax returns. It's also kinda silly to think that those same regular people would be so upset about their suspicion that they would contact their state's revenue department or the IRS (who has a similar program). And it's even sillier still to think that this would all lead to a reward for regular people.
However! Insiders that do have knowledge and expertise and, presumably, well-founded suspicisions and a case of conscience don't have much incentive to report wrong-doing if they know its happening. Brunori even mentions that most qui tam suits are "filed against businesses with real or perceived deep pockets" and turn out to be baseless. In other words, it's not so much people trying to ratting on other people; it's people ratting on corporations (FYI Mitt Romney: not people). But again, it's mostly people with no knowledge or expertise, so it doesn't waste a fair amount of time, but these are governments we're talking about.
In other news:
- Nevada says daily fantasy sports is gambling. [NYT]
- All-day breakfast isn't going so well for McDonald's. [NYP]
- Under Armour's CFO is leaving for Blue Apron. [BI]
- The debt ceiling is going to be a problem, again. [TaxVox]
- Bike lanes infringing on religious freedom. [WaPo]