The Securities and Exchange Commission today charged audit firm Marcum with systemic quality control failures and violations of audit standards in connection with audit work for hundreds of SPAC clients beginning at the latest in 2020. The SEC’s order also found that Marcum’s deficiencies were not limited to SPAC clients, but they reflected systemic quality control failures throughout the firm.

Marcum agreed to pay a $10 million penalty to settle the charges.

According to the SEC’s order, over a three-year period, Marcum more than tripled its number of public company clients, the majority of which were SPACs, including auditing more than 400 SPAC initial public offerings in 2020 and 2021. The strain of this growth, however, exposed substantial, widespread, and pre-existing deficiencies in the firm’s underlying quality control policies, procedures, and monitoring. These deficiencies permeated nearly all stages of the audit process and were exacerbated as Marcum took on more SPAC clients. Read more.

Source: SEC Charges Audit Firm Marcum with Widespread Quality Control Deficiencies