UNITED STATES OF AMERICA

Before the

SECURITIES AND EXCHANGE COMMISSION

SECURITIES EXCHANGE ACT OF 1934

Release No. 82557 / January 22, 2018

ACCOUNTING AND AUDITING ENFORCEMENT

Release No. 3919 / January 22, 2018

ADMINISTRATIVE PROCEEDING

File No. 3-18347

In the Matter of

BRIAN SWEET, CPA, 

Respondent.

ORDER INSTITUTING PUBLIC

ADMINISTRATIVE AND CEASEAND- DESIST PROCEEDINGS PURSUANT TO 

SECTIONS 4C AND 21C OF THE 

SECURITIES EXCHANGE ACT OF 1934 

AND RULE 102(e) OF THE 

COMMISSION’S RULES OF PRACTICE, 

MAKING FINDINGS, AND IMPOSING 

REMEDIAL SANCTIONS AND A CEASEAND-DESIST ORDER, AND NOTICE OF 

HEARING

I.

The Securities and Exchange Commission (“Commission”) deems it appropriate that public 

administrative and cease-and-desist proceedings be, and hereby are, instituted against Brian Sweet, 

CPA (“Respondent” or “Sweet”) pursuant to Sections 4C1and 21C of the Securities Exchange Act 

of 1934 (“Exchange Act”) and Rule 102(e)(1)(ii) and 102(e)(1)(iii) of the Commission’s Rules of 

Practice.2

 

1

Section 4C provides, in relevant part, that: 

The Commission may censure any person, or deny, temporarily or permanently, to any person the 

privilege of appearing or practicing before the Commission in any way, if that person is found . . . 

(1) not to possess the requisite qualifications to represent others; (2) to be lacking in character or 

integrity, or to have engaged in unethical or improper professional conduct; or (3) to have willfully 

violated, or willfully aided and abetted the violation of, any provision of the securities laws or the 

rules and regulations issued thereunder.

2 Rule 102(e)(1)(ii) provides, in pertinent part, that:
2

II.

In anticipation of the institution of these proceedings, Respondent has submitted an Offer 

of Settlement (the “Offer”) which the Commission has determined to accept. Solely for the 

purpose of these proceedings and any other proceedings brought by or on behalf of the 

Commission, or to which the Commission is a party, Respondent admits the Commission’s 

jurisdiction over him and the subject matter of these proceedings, and consents to the entry of this 

(“Order”), as set forth below.

III.

On the basis of this Order and Respondent’s Offer, the Commission finds3that:

SUMMARY

1. This case involves the unauthorized disclosures of confidential information from 

the Public Company Accounting Oversight Board (“PCAOB” or “Board”) relating to its 

Inspections program, and a concerted effort to use that information to benefit KPMG LLP and, 

consequently, Brian Sweet.

2. On his last day at the PCAOB in 2015, Sweet took sensitive inspections-related 

documents from the PCAOB to use as a resource in his new job in KPMG’s Department of 

Professional Practice. Shortly after he joined KPMG, Sweet asked Cynthia Holder, then a PCAOB 

employee, to send him confidential PCAOB materials. She did as he requested, then sent him 

additional confidential information relating to a planned inspection of a KPMG client. Holder 

made these unauthorized disclosures while she was seeking employment at KPMG. In 2016 and 

2017, a third PCAOB employee, Jeffrey Wada, leaked confidential information relating to the 

PCAOB’s planned inspections of KPMG to Holder after she had left the PCAOB and joined 

KPMG. Wada’s leaks to Holder in 2017 similarly occurred while he was seeking employment 

with KPMG.

3. Most of the information Sweet, Holder, and Wada disclosed without authorization 

related to the PCAOB’s inspections of KPMG audits, including the audit engagements the PCAOB 

 

The Commission may . . . deny, temporarily or permanently, the privilege of appearing or 

practicing before it . . . to any person who is found to be lacking in character or integrity or to have 

engaged in unethical or improper professional conduct.

Rule 102(e)(1)(iii) provides, in pertinent part, that:

The Commission may . . . deny, temporarily or permanently, the privilege of appearing or 

practicing before it . . . to any person who is found...to have willfully violated, or willfully aided 

and abetted the violation of any provision of the Federal securities laws or the rules and 

regulations thereunder.

3

 The findings herein are made pursuant to Respondent’s Offer of Settlement and are not binding on any 

other person or entity in this or any other proceeding. 
3

planned to inspect, the criteria the PCAOB used to select engagements for inspection, and the 

focus areas of the inspections. This was valuable information to KPMG, which had experienced a 

high rate of audit deficiency findings and had made a priority of improving its PCAOB inspection 

results.

4. Sweet told his supervisors in KPMG’s National Office, David Middendorf and 

Thomas Whittle, along with another partner in that office, David Britt, that he had taken 

confidential materials from the PCAOB and received, from time to time, additional confidential 

information from PCAOB employees. Middendorf and Whittle encouraged Sweet to share the 

PCAOB’s confidential information with them, with other KPMG colleagues, and with an outside 

contractor. After Wada sent Holder the list of the PCAOB’s planned inspections for 2016, 

Middendorf, Whittle, Britt, Sweet, and Holder undertook an effort to analyze and review audit 

workpapers and to suggest revisions to them to avoid possible findings of deficiencies by the 

PCAOB. 

5. Middendorf, Whittle, Britt, Sweet, and Holder also received from Wada 

confidential information relating to the PCAOB’s upcoming 2017 inspections. However, their 

misconduct came to light early in the year and did not affect any PCAOB inspections of the firm.

RESPONDENT

6. Brian Sweet, 40, of Fresno, California, was a Partner in KPMG’s Department of 

Professional Practice group until March 2017. Prior to joining KPMG, Sweet was an Associate 

Director in the PCAOB’s inspections group from March 2014 until April 2015. Sweet is licensed 

as a CPA in New York and Illinois and was previously licensed in California.

OTHER RELEVANT PERSONS AND ENTITY

7. Cynthia Holder, 51, of Houston, Texas was an Executive Director in KPMG’s 

Department of Professional Practice group from August 2015 until April 2017. Prior to joining 

KPMG, Holder was an Inspections Leader at the PCAOB from December 2011 until August 2015. 

Holder is licensed as a CPA in Texas. The Commission has charged Holder for her role in the 

misconduct described in this Order.

8. Jeffrey Wada, 42, of Tustin, California was an Inspections Leader at the PCAOB 

from February 2012 until February 2017. Wada is licensed as a CPA in California. The 

Commission has charged Wada for his role in the misconduct described in this Order.

9. David Middendorf, 53, of Marietta, Georgia, was KPMG’s National Managing 

Partner for Audit Quality and Professional Practice until April 2017. Middendorf is licensed as a 

CPA in Georgia, New York, and Ohio and was previously licensed in Texas. The Commission has 

charged Middendorf for his role in the misconduct described in this Order.

10. Thomas Whittle, 54, of Gladstone, New Jersey, was KPMG’s National Partner-InCharge for Inspections until April 2017. Whittle is licensed as a CPA in New York and New 
4

Jersey and was previously licensed in Pennsylvania and Connecticut. The Commission has 

charged Whittle for his role in the misconduct described in this Order.

11. David Britt, 54, of New Canaan, Connecticut, was KPMG’s Banking and Capital 

Markets Group Co-Leader until February 2017. Britt is licensed as a CPA in New York and 

California and was previously licensed in the District of Columbia. The Commission has charged 

Britt for his role in the misconduct described in this Order.

12. KPMG LLP is a Delaware limited liability partnership and PCAOB-registered 

accounting firm. Headquartered in New York, New York, KPMG is the U.S. member firm of 

KPMG International Cooperative, a Swiss entity.

FACTS

The PCAOB’s Inspections Process

13. The PCAOB was created as part of the Sarbanes-Oxley Act of 2002 to oversee the 

audits of public companies that are subject to the securities laws in order to protect the interests of 

investors and further the public interest in the preparation of informative, accurate, and 

independent audit reports.

14. One of the critical ways in which the PCAOB fulfills this mission is by inspecting 

audits of public companies conducted by registered public accounting firms. Through these 

inspections, the PCAOB assesses the audit firms’ compliance with the statutes, regulations, and 

professional standards governing the accounting profession. The PCAOB typically selects the 

audit engagements it will inspect based on confidential internal analysis and thereafter notifies 

firms which audits it will inspect. The PCAOB typically issues inspection reports, only parts of 

which are made public, after all the inspections for a firm are complete. 

15. To ensure the integrity of the inspection process, the PCAOB closely guards the 

confidentiality of both its inspection targets prior to firm notification and its methodology for 

selecting those targets. All PCAOB employees must certify that they are complying with PCAOB 

Ethics Rules that prohibit employees from using confidential PCAOB information for private gain 

(or even merely creating the appearance that they are) and that bar them from making unauthorized 

disclosures of confidential information obtained during their employment. The PCAOB’s Ethics 

Rules and the employees’ ethics certifications state these prohibitions continue to apply even after 

their employment with the Board ends.

KPMG’s Pursuit of Sweet

16. In September 2014, the PCAOB issued a report regarding its 2013 inspections of 

KPMG audits. The report found that out of 50 audits the PCAOB inspected, 23 were deficient. 

This 46 percent deficiency rate, which placed KPMG third among the “big four” accounting firms, 

reflected a significant decline from KPMG’s 34 percent deficiency rate the previous year. As a 

result, KPMG leadership exerted meaningful pressure within the firm to improve the results. One 

of the steps KPMG took to improve its results was to hire Sweet, an Associate Director at the 
5

PCAOB who worked on the team inspecting KPMG audits, to join the firm. KPMG’s Vice Chair 

of Audit characterized Sweet’s recruitment as a “top priority.”

17. KPMG hired Sweet as a partner in the Department of Professional Practice (“DPP”) 

group in the firm’s National Office.4 Among other things, Sweet was responsible for conducting 

internal inspections of KPMG audits. 

Sweet Divulges Confidential PCAOB Information to KPMG

18. In April 2015, shortly before leaving the Board, Sweet copied from an internal 

PCAOB database to his office computer various confidential inspection-related materials he 

believed might help him at KPMG. On his last day at the Board, Sweet transferred these 

documents and the other files on his PCAOB computer to a personal hard drive that he took with 

him. Sweet also took from the PCAOB hard copy documents and retained confidential PCAOB 

documents he had previously brought home. 

19. These documents included PCAOB inspection planning information, inspection 

guides and manuals, and drafts of confidential inspection comment forms. The planning materials 

included the confidential list of KPMG audit engagements the PCAOB intended to inspect in 2015, 

the focus areas for each inspection, and a list of all the quantitative and qualitative criteria the 

Board used in deciding which KPMG audit engagements to inspect. 

20. Upon joining KPMG in May 2015, Sweet transferred the PCAOB documents from 

his personal hard drive to his computer at the firm. 

A. Sweet Divulges Confidential PCAOB Information Regarding 2015 Inspections to 

Middendorf, Whittle, and Britt

21. At KPMG, Sweet reported to Thomas Whittle, who was responsible for overseeing 

both the PCAOB’s and KPMG’s internal inspections. Whittle, in turn, reported to David 

Middendorf, who oversaw the National Office’s audit quality and professional practice work.

22. On his first day at the firm in May 2015, Sweet had lunch with Middendorf and 

other KPMG National Office colleagues, including David Britt, another National Office partner 

who was co-leader of KPMG’s Banking and Capital Markets Group. During the lunch, Sweet’s 

new colleagues asked him various questions about the PCAOB’s inspections of KPMG. One of 

the questions Middendorf asked Sweet was whether the PCAOB intended to inspect a specific 

KPMG banking client that year. Without answering directly, Sweet indicated the PCAOB planned 

to do so. 

23. Several days later, Whittle asked Sweet to provide him the list of the PCAOB’s 

planned inspections for 2015.5 Sweet showed Whittle a hard copy of a PCAOB inspection 

 

4 KPMG’s National Office is responsible for technical accounting and auditing leadership, risk management, 

and quality control for the firm.
6

planning document that identified 46 KPMG audits the PCAOB intended to inspect that year and 

included the PCAOB’s confidential areas of focus for those inspections.

24. The next day, Whittle emailed Sweet, asking him to have an assistant “scan and 

send me the banking selection list” (i.e. KPMG’s bank holding company clients the PCAOB had 

selected for inspection). Sweet complied by sending Whittle the complete list of planned 

inspections and asked Whittle to exercise discretion given the nature of the information. Whittle 

forwarded this information to Middendorf the same day, writing, “The complete list. Obviously, 

very sensitive. We will not be broadcasting this.”6 

25. In June 2015, Sweet identified for Britt a number of KPMG banking clients the 

PCAOB planned to inspect in 2015. The next day, Britt emailed Sweet to ask Sweet to review his 

notes and provide the “last 3 Bank names.” Sweet gave Britt the information later that day, asking 

him to note its sensitivity and “use your discretion with this info.”

26. Sweet shared the information he had taken from the PCAOB with his new 

colleagues to benefit himself and the firm. He believed, based on comments Middendorf and 

Whittle had made to him, that his position as a partner at KPMG was not secure. Sweet believed it

would help him in his position at KPMG if he were perceived as a team player working to help the 

firm.

B. Middendorf and Whittle Direct Sweet to Divulge Confidential PCAOB Information to An 

Outside Consultant

27. In April 2015, KPMG engaged an outside consultant to help it predict which audit 

engagements the PCAOB would inspect in 2016. In June 2015, Middendorf and Whittle both 

approached Sweet in his office and directed him to share everything he knew with the outside 

consultant. Sweet understood this to be an instruction to give the consultant all of the information 

he took from the PCAOB.

28. Sweet complied with Middendorf and Whittle’s directive by providing information 

about the Board’s selection criteria to a KPMG colleague, who then gave that information to the 

consultant. In September 2015, Sweet spoke directly with the consultant and gave them additional 

confidential information regarding the inspections selection process.7 At the end of September, 

 

5 By that time, the PCAOB had informed KPMG of less than half of the audit engagements it intended to 

inspect in 2015. 

6

Though Whittle immediately assigned Sweet to review the workpapers of one of the inspection targets, it 

does not appear that any workpapers were changed in response to Sweet providing the 2015 inspection list. At the 

time Sweet provided this information to Middendorf and Whittle, KPMG had, pursuant to its policy, locked the 

audit workpapers for all but two of the engagements from editing absent special circumstances. 

7 Among other things, Sweet explained how the PCAOB’s Inspections group used confidential information 

received from the Board and the SEC. 
7

Sweet reported to Middendorf and Whittle that he had “spent quite a bit of time with [the outside 

consultant] trying to guide their modeling efforts.”

C. Sweet Divulges Confidential PCAOB Information to Others

29. Sweet also used the confidential information he had taken from the PCAOB in 

other ways. In August 2015, Sweet informed a KPMG National Office colleague that the PCAOB 

was unlikely to inspect certain engagements in 2016. Sweet wrote, “I checked my old planning 

notes and can confirm that [four KPMG audit clients] are NOT on the PCAOB’s planning radar. 

They don’t have any of them included in the issuer count, so it is fairly safe to say those have a 

very remote chance of ever being evaluated for inspection!”

30. In April 2016, Sweet provided confidential PCAOAB information to an audit 

partner preparing a client pitch for a Spanish bank’s audit business.8 Sweet sent the partner 

confidential PCAOB comment forms related to the Board’s inspection of another Spanish bank, 

writing that he had attached “some examples of the types of issues that have been raised in the 

past. I hope this helps!” The comment forms discuss specific ways in which that bank’s auditor 

had failed to adequately test the valuation of its allowance for loan loss. 

Holder Divulges Confidential PCAOB Information to KPMG

31. After KPMG offered Sweet a position at the firm, Whittle asked Sweet for a list of 

PCAOB employees whom KPMG should consider recruiting. Before he left the PCAOB, Sweet 

had discussed with Cynthia Holder, a friend who was then a PCAOB Inspections Leader, the 

prospect of her joining him at KPMG. On Sweet’s first day at KPMG (May 4, 2015), he informed 

Holder that he would be meeting with Whittle to push for the firm to hire her. On May 11, 2015, 

Sweet told Holder he was going to hand-deliver her resume to Whittle and “make a sell again” in 

person.

32. On May 12, 2015, Sweet asked Holder to send him a confidential PCAOB 

document reflecting comments he had written about KPMG’s audits while he was at the Board. At 

that time, KPMG personnel were preparing for a meeting with the PCAOB to discuss the firm’s 

performance on its audits, during which KPMG would make a presentation on the root causes of 

the firm’s audit failures. Sweet asked Holder for a document he had written while he was at the 

PCAOB so he could review it before helping his KPMG colleagues prepare that presentation. That 

day, Holder sent Sweet the document he requested. 

33. About two weeks later, Holder notified the PCAOB’s ethics group that she had 

recused herself from any work related to KPMG in order to pursue employment at the firm. 

 

8 The Spanish bank’s auditor was rotating off pursuant to the European Union’s mandatory audit firm 

rotation rules. Securing this audit business was a global priority for KPMG (which marketed its banking expertise) 

as a result of recent failures to win the audit business of several other large multinational banks.
8

34. On June 17, 2015, Holder again shared confidential PCAOB information with 

Sweet, telling him that the Board had decided to cancel its planned inspection of a KPMG audit 

client for 2015, and that the Board did not intend to replace it with another selection. Sweet 

immediately relayed this information to Whittle. 

35. KPMG sent Holder an employment offer in July 2015. She joined the firm the 

following month as an Executive Director in DPP performing internal inspections and advising 

banking engagement teams on their audits.

Wada Divulges Confidential PCAOB Information to KPMG in 2016

36. In early March 2016, Wada, an Inspections Leader at the PCAOB who had 

previously performed work on KPMG inspections but was then assigned to inspect another audit 

firm, learned that he had not been selected for a promotion. Wada reacted angrily, telling a 

colleague the PCAOB had “screwed” him by passing him over. 

37. After learning he had not been selected for promotion, Wada accessed the 

PCAOB’s confidential list of KPMG engagements the Board had selected for inspection in 2016 

from an internal database of KPMG-related documents. Because Wada was no longer working on 

KPMG matters, he had no legitimate reason to access this information. 

38. On March 28, 2016, Wada, who remained friends with Holder after she left the 

PCAOB, called her and read to her the names of twelve KPMG clients the Board planned to 

inspect.9 Holder provided this information to Sweet, who then immediately relayed the list to 

Whittle, Middendorf, and Britt, informing them that it had come from a former colleague at the 

PCAOB.

Use of Confidential PCAOB Information to Change KPMG Audit Workpapers

39. Wada gave KPMG the list of the PCAOB’s planned inspections at a critical time in 

two respects.

40. First, in early February 2016, Middendorf and other members of KPMG’s 

leadership team had met with staff from the SEC’s Office of the Chief Accountant (“OCA”). 

During that meeting, OCA personnel expressed significant concerns about the firm’s audit quality 

and questioned whether KPMG was adequately addressing these issues. On the same day they 

received the list of inspection targets from Wada, Middendorf, Whittle, Sweet, and Britt discussed 

how to use the information. Middendorf told the group his highest priority was to protect one of 

the efforts KPMG’s National Office had instituted to improve audit quality from criticism. As the 

PCAOB found an increasing number of audit deficiencies by KPMG beginning in 2013, KPMG 

created “monitoring programs” run by DPP that reviewed workpapers to ensure compliance with 

 

9 Of the 12 clients, 10 were bank holding companies and 2 were other issuers that Wada appears to have 

thought were also bank holding companies. It appears that Wada identified these engagements for Holder because 

her responsibilities at KPMG included advising banking engagement teams.
9

professional standards.10 One of these programs focused on the audits of certain banking clients’ 

Allowances for Loan and Lease Losses (“ALLL”). KPMG created the ALLL monitoring program 

in 2015 in response to numerous deficiencies the PCAOB had identified in this area. The success 

of the ALLL monitoring program was especially important to KPMG because the firm had 

promoted it as proof of the seriousness with which it was working to improve its audit quality.

41. Second, Wada alerted KPMG to the PCAOB’s planned inspections at a time when 

KPMG personnel were able to access and change audit workpapers. Though KPMG had already 

issued audit reports for each of these engagements, KPMG was within the 45-day period in which 

KPMG’s policy allowed audit teams to complete the administrative process of assembling the final 

audit file. In general, KPMG could only perform certain clerical work during this period. At the 

end of this 45-day period, KPMG locked audit workpapers from editing absent special 

circumstances.

42. Recognizing that the workpapers had not yet been locked per KPMG’s policy, 

Middendorf, Whittle, and Britt agreed to have Sweet and others conduct an additional examination 

of the audit workpapers for the seven banks on the list Wada had provided that were part of 

KPMG’s ALLL monitoring program to determine whether anything could be done to minimize the 

risk that the PCAOB would find deficiencies in those audits. 

43. Middendorf and Whittle instructed that no one in the briefing should disclose that 

they had obtained confidential PCAOB information. 

44. To provide cover for their project, Britt told others at KPMG that they were 

performing work in the ordinary course of business on all 35 banking engagements in the firm’s 

ALLL monitoring program. On March 28, 2016, Britt sent the engagement partners for these 

audits an email stating that, as part of the “wrap up and reporting of the results” of the ALLL 

program, DPP needed to gather “some additional information” from their audit workpapers.11

45. Over the next few weeks, Sweet, Holder, and various partners and managing 

directors in DPP engaged in a review of the audit workpapers of the seven banks in the monitoring 

program that were on the list Wada provided. The DPP professionals suggested edits and proposed 

changes to the engagement teams, which then decided what changes to incorporate into the final 

audit workpapers.12

 

10 KPMG’s monitoring programs included both “in flight” reviews (reviews conducted prior to the issuance 

of the audit opinion) and post-issuance programs that were intended to assess the engagement team’s performance 

after its audit work was complete. 

11 Britt also asked a subordinate in the National Office to conduct his own secret review of one KPMG 

client’s audit workpapers.

12 Middendorf, Whittle, Sweet, and Britt had agreed that Sweet would lead a team of DPP professionals to 

review the workpapers of the banks in the monitoring program, and that Middendorf, Whittle, and Britt would 

handle the other five issuers on the list they received from Wada. 
10

Wada Divulges Confidential PCAOB Information to KPMG in 2017

46. In early January 2017, Wada provided Holder a “preliminary” list of PCAOB 

inspection targets for 2017. On January 9, Holder relayed the names of the clients on the list to 

Sweet, and together, they briefed Whittle. That night, Sweet, Whittle, and Britt discussed this 

information. After that meeting, Sweet, as instructed by Whittle, contacted the engagement 

partners for two of the audits on the January 2017 list to warn them about the potential inspections. 

47. On January 10, Wada sent Holder his resume and a narrative of his work 

experience, writing, “I am now trying to sell myself to KPMG.”

48. On February 2, Wada sent Holder two text messages in quick succession: first, 

“Okay, I have the grocery list,” then “All the things you’ll need for the year.” The next day, he 

called Holder and read her a list of 47 ticker symbols that Holder understood to be the final list of 

2017 inspections. Wada also provided Holder the inspection focus areas for the banks on the list 

(as well as for another KPMG engagement), and the PCAOB’s list of KPMG engagement partners 

with “poor performance evaluations.” 

49. Holder relayed the information to Sweet, who then shared it with Middendorf, 

Whittle, and Britt. Whittle instructed Sweet to warn certain engagement partners about the 

impending inspections. Though Whittle had warned Sweet to be circumspect in how he 

communicated this to KPMG colleagues, Sweet’s notice to one KPMG engagement partner caused 

her to suspect that the firm may have received confidential PCAOB information. KPMG began to 

investigate these issues after its Office of General Counsel learned of her concerns.

50. During the initial stage of KPMG’s investigation, Sweet and Holder agreed to 

conceal how they learned of the PCAOB’s 2017 inspection targets.13 They agreed to tell 

investigators that Holder had received a list of ticker symbols by mail with no return address or 

other identifying information. Sweet then created a document consisting solely of the ticker 

symbols, which he provided to KPMG attorneys after they interviewed him. 

VIOLATIONS

51. As a result of the conduct described above, Respondent willfully violated PCAOB 

Ethics Code Section EC3, which prohibits PCAOB staff from acting in a manner which might 

reasonably result in or reasonably create the appearance that the employee is using confidential 

information obtained through service for the Board for the private gain of any person.

52. As a result of the conduct above, Respondent willfully violated PCAOB Ethics 

Code Section EC9, which prohibits PCAOB staff from disseminating or otherwise disclosing any 

information obtained in the course and scope of his or her employment, and which has not been 

released, announced, or otherwise made available publicly.

 

13 Holder told Sweet that she had sworn to Wada she would never identify him as the source.
11

53. As a result of the conduct above, Respondent willfully violated PCAOB Rule 

3500T, requires members to maintain integrity when performing any professional service in 

connection with the preparation or issuance of any audit report.

54. As a result of the conduct above, Respondent willfully aided and abetted and 

caused Holder’s violations of PCAOB Ethics Code Sections EC3 and EC9.

FINDINGS

55. Based on the foregoing, the Commission finds that Sweet willfully violated 

PCAOB Ethics Code Sections EC3, EC9, and PCAOB Rule 3500T, and willfully aided and 

abetted and caused Holder’s violations of Sections EC3 and EC9.

56. Based on the foregoing, the Commission finds that Sweet lacks integrity pursuant to 

Section 4C(a)(2) of the Exchange Act and Rule 102(e)(1)(ii) of the Commission’s Rules of 

Practice.

57. Based on the foregoing, the Commission finds that Sweet engaged in improper 

professional conduct pursuant to Section 4C(a)(2) of the Exchange Act and Rule 102(e)(1)(ii) of 

the Commission’s Rules of Practice.

IV.

Respondent acknowledges that the Commission is not at this time requiring that 

Respondent disgorge any ill-gotten gains or imposing a civil penalty based on his agreement to 

cooperate in a related enforcement action. However, pursuant to this Order, Respondent agrees to 

additional proceedings in this proceeding to determine what, if any, disgorgement or civil penalties 

pursuant to Sections 21C(e) and 21B(a) of the Exchange Act against Respondent are in the public 

interest. In connection with such additional proceedings: (a) Respondent agrees that he will be 

precluded from arguing that he did not violate the PCAOB Ethics Rules as described in this Order; 

(b) Respondent agrees that he may not challenge the validity of this Order; (c) the findings of this 

Order shall be accepted as and deemed true by the hearing officer; and (d) the hearing officer may 

determine the issues raised in the additional proceedings on the basis of testimony and 

documentary evidence.

V.

In view of the foregoing, the Commission deems it appropriate to impose the sanctions 

agreed to in Respondent Sweet’s Offer.

Accordingly, it is hereby ORDERED, effective immediately, that:

A. Sweet shall cease and desist from committing or causing any violations and any

future violations of PCAOB Ethics Code Sections EC3 and EC 9 and PCAOB Rule 3500T.
12

B. Sweet is denied the privilege of appearing or practicing before the Commission as 

an accountant.

C. Pursuant to Rule 100(c) of the Commission’s Rules of Practice, 17 C.F.R. § 

201.100(c), in the interest of justice and without prejudice to any party, that a public hearing for the 

purpose of taking evidence on the questions set forth in Section IV hereof shall be convened at a 

time and place to be fixed, and before an Administrative Law Judge to be designated by further 

order as provided by Rule 110 of the Commission’s Rules of Practice, 17 C.F.R. § 201.110, 

following the entry of a final judgment against the last remaining defendant in the Order Instituting 

Public Administrative and Cease-and-Desist Proceedings Pursuant to Sections 4C and 21C of the 

Securities Exchange Act of 1934 and Rule 102(e) of the Commission’s Rules of Practice, and 

Notice of Hearing in the Matter of Cynthia Holder, CPA, Jeffrey Wada, CPA, David Middendorf,

CPA, Thomas Whittle, CPA, and David Britt, CPA (the “Related Action”).

If Respondent fails to appear at a hearing after being duly notified, Respondent may 

be deemed in default and the proceedings may be determined against his upon consideration of this 

Order, the allegations of which may be deemed to be true as provided by Rules 155(a), 220(f), 

221(f), and 310 of the Commission’s Rules of Practice, 17 C.F.R. §§ 201.155(a), 201.220(f), 

201.221(f), and 201.310. 

This Order shall be served forthwith upon Respondent personally or by certified mail.

D. IT IS FURTHER ORDERED, pursuant to Rule 100(c) of the Commission’s Rules 

of Practice, 17 C.F.R. § 201.100(c), in the interest of justice and without prejudice to any party, that 

the Administrative Law Judge shall issue an initial decision no later than 300 days from the date of 

the entry of a final judgment in the Related Action.

In the absence of an appropriate waiver, no officer or employee of the Commission engaged 

in the performance of investigative or prosecuting functions in this or any factually related 

proceeding will be permitted to participate or advise in the decision of this matter, except as witness 

or counsel in proceedings held pursuant to notice. Since this proceeding is not “rule making” within 

the meaning of Section 551 of the Administrative Procedure Act, it is not deemed subject to the 

provisions of Section 553 delaying the effective date of any final Commission action.

By the Commission.

Brent J. Fields

Secretary