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Lead auditor admits omitting ongoing investigation in work papers in noting change of regulators

Email from head of PwC Risk Management to senior execs notes that PwC engagement team “was in denial.”

Paperwork showed investor mortgage deal that didn't exist.

Westbrook admits he did not know that audited statements needed to go to Freddie Mac and Ginnie Mae

Westbrook says, from the stand, that ultimate responsibility was to client—not the public

Wes Kelly, senior audit manager, says in video deposition he "doesn't know what it means" to do a good job on audit.

Wes Kelly, who managed Colonial audits, testifies on video that an auditor's responsibility is not to find or detect fraud under standards.

PwC paying legal fees incurred by ex-auditor Kelly, who is now with SEC's Office of Accounting.

Ex-TBW general counsel says business halted "instantaneously" with '09 FBI raid, asset freeze.

Jeffery Cavender says he relied on PwC clean audit opinions in order to do his job while TBW general counsel.

Cavender says after FBI raid, he got board members, top TBW execs including CEO Lee Farkas to resign.

Back on stand today, ex-TBW general counsel Jeff Cavender reiterates his company relied on PwC's clean audits of Colonial Bank.

Ex GC testifies that federal law required audited financials from Colonial Bank be filed with the SEC each year.

Ex GC breaks down on the stand as he recounts having to fire 2500 TBW employees because of the Colonial fraud.

Former GC says he's stayed with the case in the interest of TBW creditors, customers, 2,500 fired employees.

Former TBW accountant Maureen Emig testifies she personally certified that PwC submitted clean audit opinions for Colonial.

Emig said if she couldn't certify audits as clean, TBW would be unable to do business with Freddie Mac.

After FBI raid of TBW, Emig stayed to help trustee and also helped Justice Dept. with Lee Farkas prosecution.

Emig met with Feds "and provided them with information ... we uncovered a number of things we had no knowledge of prior to the shutdown."

In taped testimony, ex-senior PwC auditor on Colonial account says if he knew loans didn't exist, he would have halted audit.