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June 9, 2010

PFF Bancorp creditors target KPMG

PFF Bancorp creditors are seeking permission
to probe KPMG US to establish whether the auditor knew the failed
financial services company was taking on too much risk.

PFF Bancorp’s official committee of unsecured
creditors filed court documents in the US Bankruptcy Court
requesting KPMG release documents to ascertain if the auditor was
aware the company was undercapitalised prior to its collapse in
2008.

“Information in KPMG’s possession may support
potential claims against third parties and against KPMG itself, if,
for example, it becomes apparent that KPMG knew or should have
known at an early date of any overly-aggressive or
inadequately-controlled loan practices of the (company),” PFF
Bancorp creditors wrote in the request.

The creditors also want to establish if KPMG
knew of PFF’s lending portfolio risk profile and its failure to
maintain adequate loan reserves.

The California based PFF Bank and Trust was
seized in November 2008 by US regulators and its assets sold to US
Bancorp.

A hearing on the creditors’ request is set for
June 23.

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