Ernst & Young, one of the top accounting firms in the world, is being fined $100 million by federal regulators after admitting its employees cheated on their ethics exams.

For years, the firm's auditors had cheated to pass key exams that are needed for certified public accountant licenses, the Securities and Exchange Commission found. Ernst & Young also had internal reports about the cheating but didn't disclose the wrongdoing to regulators during the investigation.

"It's simply outrageous that the very professionals responsible for catching cheating by clients cheated on ethics exams of all things," Gurbir S. Grewal, director of the SEC's Enforcement Division, said in a release.

The fine is the largest penalty ever imposed by the SEC on an audit firm.

The CPA, or certified public accountant, licenses are needed by auditors to evaluate the financial statements of companies and ensure they are complying with laws.

However, the SEC says that a "significant number" of Ernst & Young audit professionals specifically cheated on the ethics component of the CPA exams that were required for their accounting jobs.

Audit firms serve a critical gatekeeping role in the financial markets and it is their jobs to ensure integrity of the financial reporting done by companies. It's why the independence and integrity of these firms are paramount.

Because it's their job to hold others accountable, Ernst & Young — one of the "big four" accounting firms — says it holds itself to...

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