Michael Joseph, a partner with CPA firm Ernst & Young, who had been denied the privilege of appearing and practicing before the SEC since 2006 because of violations allegedly committed while servicing clients American International Group and PNC Financial Services Group, was reinstated by the SEC and, once again, will be allowed to appear and practice before the Commission as an accountant.  The SEC had charged Mr. Joseph with violating antifraud, reporting, and recordkeeping provisions of the federal securities laws, as well as auditor independence standards, dating back to 2001.

This order is issued in response to Joseph’s application for reinstatement to appear and practice before the Commission as an accountant responsible for the preparation or review of financial statements required to be filed with the Commission.

    Alleged Violative Actions.   The SEC found that in 2001 that Joseph specifically helped develop and market an accounting product for E&Y client, AIG, and then worked with an E&Y audit team to advise E&Y audit client, PNC Financial Services Group, on the accounting treatment for a version of that product.  As a result of his advice, PNC improperly excluded certain assets from its consolidated financial statements.  The improper accounting was included in several Forms 10-Q and certain registration statements for PNC securities.

Mr. Joseph attests he will undertake to have his work reviewed by the independent audit committee of any company for which he works, or in some other manner acceptable to the SEC, while practicing before the Commission in this capacity.  Joseph is not, at this time, seeking to appear or practice before the Commission as an independent accountant - though if he should wish to do so, he'll be required to submit an application to the Commission showing that he has complied and will comply with the terms of the original suspension order in this regard. Therefore, Joseph’s suspension from practice before the Commission as an independent accountant continues in effect until the Commission determines that a sufficient showing has been made in this regard in accordance with the terms of the original suspension order.   [SEC Admin Proceeding 3-12502, 10-7]