Accounting firm BDO has been fined $521 million in the USA. It's annual fee income is $589 million. $351 million of the penalty is punitive damages. $170 million is compensation for failing to sport a fraud.

I'm no friend of lax audits. And they're too commonplace. But I'm no friend of the US legal system either. Paying for your error is one thing. A fine of $351 million for an error is excessive. It was fair to levy a fine for fraudulent behaviour of the type KPMG pursued on tax. But this one? No, this is out of proportion. BDO partners in the states might make $500,000 a year each, but I suspect that total profits do not exceed $180,000 in the US in this firm. They can't survive that level of fine as a result. Their insurance won't support that.

But let's be clear: this is no more than market risk. US law may be daft, but there are many more deserving victims of US injustice than BDO partners. And I'm going to disagree with BDO when they say in Court papers that:

the case could trigger severe losses and large numbers of redundancies.

The losses will only be to BDO partners who knew they risk they were taking. The job losses will be swept up in the marketplace in a short time. In fact, you can bet the best people are already looking for new posts right now. That's the price of getting things wrong. And that's what market economics says is the necessary consequence of doing so. You can't only have the upside.