The Union-Tribune reports the former auditors, Calderon, Jaham & Osborn, and an accountant who was the firm’s sole shareholder, Thomas Saiz, agreed to pay a $15,000 fine and accepted an order not to engage in future violations. However, the SEC said its “investigation is ongoing as to other individuals and entities that may have violated federal securities laws,” according to the news report.
The SEC on Tuesday officially charged the former auditors with fraud for false and misleading financial statements that were used in city bond offerings, the Associated Press reported. A year ago the SEC sanctioned the city of San Diego for committing securities fraud by lying about the true financial status of its pension and retiree health obligations when selling the municipal bonds (See San Diego Slapped with SEC Sanctions for Bond Sale Fraud).
The city’s financial problems began five years ago when a former pension board member raised concerns about a deal to increase benefits while underfunding the system’s obligations, the Union-Tribune pointed out. Much of the action against San Diego pension system officials has been led by city attorney Michael Aguirre, who claims the SEC is not doing enough to “confront malfeasance by local officials.” (See San Diego’s Aguirre Demands More SEC Action on Pension Mess)