?

soth12: Why not post about this on the BOFI boards for those who are members…

I’m not a member so I’ll make this short and sweet. Aurelius’ allegation is built on a false premise. Aurelius writes that:

During the call, one of Mr. Garrabrants’ key assertions was that BOFI’s independent external auditor, BDO, was made aware of the whistleblower’s allegations, completed a review, and found them to be without merit.

As Mr. Garrabrants stated in his prepared remarks:

The Bank has never omitted a calculation which would impact the allowance for loan loss and leases… A review by the Bank’s external auditors and examiners concluded that there are no significant findings.

See those ellipses? Nine times out of ten ellipses mean that the writer is distorting a speaker’s (or writer’s) remarks.

Here is the full quote [emphasis mine]:

“The Bank has never omitted a calculation which would impact the allowance for loan loss and leases. After reviewing the plaintiffs’ internal audit it was clear that he did not understand which of the bank’s loan types had unfunded commitments and that he did not understand the generally accepted accounting principles that would apply to this area. A review by the Bank’s external auditors and examiners concluded that there are no significant findings.”

Garrabrants is not addressing whistleblower allegations at all. He is addressing only the “plaintiffs’ internal audit” and the plaintiff’s lack of understanding of unfunded commitments.

As far as the nonsense about BDO’s unwillingness to issue a comfort letter, there is a legal action against BofI and a countersuit against Matt Erhart. Does anyone believe that BDO’s attorney’s would let it step into this litigation until absolutely necessary?

23 Likes