US judge orders PwC to pay $625.3 mn to FDIC in Colonial Bank collapse case

A federal judge on Monday said PricewaterhouseCoopers LLP must pay $625.3 million (£475.7 million) in damages to the Federal Deposit Insurance Corp for failing to uncover fraud that led to one of the largest bank failures of the global financial crisis.

US District Judge Barbara Rothstein found it more likely than not that PwC's negligence was the proximate cause of FDIC damages from the August 2009 demise of Montgomery, Alabama's Colonial BancGroup Inc, once among the 25 largest US banks.

Rothstein said PwC failed to uncover a multi-year fraud between Colonial, its former client, and Ocala, Florida-based Taylor, Bean & Whitaker, once the nation's 12th largest mortgage lender and a major Colonial customer.

The FDIC sued in its role as receiver for Colonial Bank, which once had more than $25 billion of assets and 340 branches.