Merrimack College v. KPMG LLP


10/28/19 – 11/19/19


KPMG will not have to pay any damages in a college’s malpractice lawsuit alleging they should have detected fraud in the school’s financial aid office, after a Massachusetts state court jury on Tuesday found the accounting giant only 15 percent liable.

While the jury did award Merrimack College $100,000, Massachusetts law prohibits a plaintiff from collecting damages if their share of liability exceeds that of a defendant.

Merrimack, a private college in North Andover, sued KPMG in 2014 claiming that audits it carried out from 1998 to 2004 should have alerted school officials that the director of financial aid at the time, Christine Mordach, was fraudulently issuing student loans and falsifying records. They claimed KPMG’s supposed negligence cost the school $7.4 million.

KPMG argued their audits were adequate, and that it was Merrimack’s responsibility to detect and prevent fraud by its own employees.


Verdict for Plaintiff - $150k award.

Jury found for Merrimac, damages awarded $100,000.00, found that KPMG was negligent (15%), that Merrimac was 85% comparatively negligent for 1999 to 2002. As to later years 2002 and later, Jury found damages were $50,000.00; that KPMG was 7.5% negligent, and that Christine Murdach was 92.5% responsible due to her fraud.


PM Session
3 Chapters

Recording Disclaimer: This proceeding was recorded in full.

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