KPMG has sent a letter to the structurers and distributors of Keydata Investment Services' Secure Income Bond, requesting they remove its name from the bond's marketing material. The SIB is a securitization of life assurance policies which aims to pay a high income coupon and return capital. Keydata and MeesPierson Intertrust, the bond's administrator, say the actuarial model on which projections are based was written by KPMG (DW, 11/11). Stewart Ford, managing director of Keydata in London, said the firm is in discussions with KPMG, but has had confirmation from counterparties involved in the bond that it has not misrepresented KPMG's involvement in its marketing material. "I see it as a non-issue," said Ford, who explained Keydata, as distributor of the bond, would not have had an arrangement with KPMG and would not have been required to contact the accounting firm directly before using its name in marketing material.
Colm Smith, head of client accounting at MeesPierson Intertrust, confirmed to DW he had received the letter Monday and was discussing it internally, but he did not respond to further messages before press time Wednesday. The letter was also copied to the Financial Services Authority. Robin Gordon-Walker, spokesman for the FSA, declined comment.
The letter, obtained by DW, was sent by the associate general counsel of KPMG in New York, Donald Rose, to Keydata, which is distributing the bond, and also MeesPierson, which is custodian, registrar and administrator of the bond. MeesPierson companies are also directors of the special-purpose vehicle SLS Capital, which issued the bond.
Rose writes in the letter KPMG's name was used without authorization in marketing material for both Keydata's Secure Income Bond and the underlying ABS notes issued by SLS Capital. "The Materials falsely represent that KPMG is a "Party Involved" in such offerings and falsely implies that KPMG has provided actuarial services to Keydata and/or SLS," writes Rose. He requests they remove KPMG's name from marketing material and publicize the correction. Tom Fitzgerald, spokesman for KPMG in New York, returned messages left with Rose, and said in an email to DW, "We do not endorse or recommend these products, nor is KPMG associated with the offering of these products."
