PCAOB Sanction Deloitte Mexico

On Oct. 31, PCAOB fined Deloitte partners re Mexico subsidiary.

  • Follows audit of Prestaciones Finmart, that was a subsidiary of US firm EZCORP.
  • EZCORP was loan provider with operations in countries including US and Mexico.
  • Galaz, Yamazaki, Ruiz Urquiza, S.C., known as Deloitte Mexico, Ricardo Agustín
    García Chagoyán, José Ignacio Valle Aparicio, Rubén Eduardo Guerrero Cervera.

Alleged Violations

  • Partners had failed to appropriately evaluate company 2013-2014 loan reserves.
  • As well as misrepresentations about that work, to principal auditors, Deloitte US.
  • Deloitte US relied upon the work of audit subsidiary, in issuing two audit reports.
  • Partners García, Valle and Guerrero failed to perform tests of loan classifications.
  • Did not evaluate effectiveness of internal controls over financial reporting (ICFR).
  • Sent falsifications to US auditor, which relied on the work for issuing audit report.
  • Misclassification led to Finmart understating loan reserves and bad debt expense.
  • Failed to recognize extent of Finmart nonperforming loans, with deficient control.
  • EZCORP disclosed it had failed to maintain effective ICFR, during the time period.


  • PCAOB barred and fined, three Deloitte Mexico partners, for deficiencies in audit.
  • Imposed penalty of $50,000 each on García and Valle, and $30,000 on Guerrero.