Accounting firm Deloitte Touche Tohmatsu reportedly in talks to acquire Arthur Andersen

NEW YORK - Arthur Andersen, damaged by its connections to bankrupt client Enron Corp., is reportedly talking with accounting firm Deloitte & Touche Tohmatsu about selling some or all of its operations. <br> <br> Negotiations began last week between New York-based Deloitte and Chicago-based Arthur Andersen LLP, The New York Times and The Wall Street Journal reported Monday. The newspapers cited sources involved in the talks who spoke anonymously. <br> <br> The Securities and Exchange Commission and other agencies are investigating Andersen&#39;s work for former energy giant Enron Corp., which filed for Chapter 11 bankruptcy protection Dec. 2 amid questionable accounting practices. Investigators have centered on the alleged shredding of Enron documents by Arthur Andersen, which was Enron&#39;s chief auditor. <br> <br> A deal, the terms of which aren&#39;t known, could be announced this week. The Times said discussions are still &#34;fluid,&#34; and no decision has been reached if Andersen would be sold in pieces or completely. <br> <br> The Wall Street Journal reported that Andersen is negotiating with federal prosecutors over possible criminal indictments. <br> <br> The Journal said the company will meet with the Justice Department to try and reach an agreement that would avoid &#34;criminal obstruction-of-justice charges.&#34; <br> <br> Several high-profile clients have defected from Andersen in the wake of the Enron collapse. Last week, Delta Air Lines and Freddie Mac both fired the accounting firm. Other defections include Merck Inc. and SunTrust Banks. <br> <br> Andersen&#39;s number of U.S. public audit clients was 2,311 as of last Aug. 31, and the defections make a small percentage. But experts say the quickening pace of defections and the size and influence of companies lost add up to potentially fatal consequences for Andersen.

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