The Securities and Exchange Commission (SEC) charged Deloitte & Touche LLP with violating auditor independence rules when its consulting affiliate maintained a business relationship with a trustee serving on the boards and audit committees of three funds it audited. Deloitte agreed to pay $497,438 in disgorgement of audit fees, plus prejudgment interest of $116,478 and a civil penalty of $500,000 to settle the charges, which it neither admitted nor denied. According to the SEC, Deloitte violated the rules with respect to the appearance of independence by failing to follow its own policies and conduct an independence consultation prior to entering into a new business relationship with the trustee. Deloitte failed to discover that the required initial independence consultation was not performed until nearly five years after the independence-impairing relationship had been established between Deloitte Consulting LLP and the trustee, who was paid consulting fees for his external client work. Meanwhile, Deloitte represented in audit reports that it was independent of the three funds while the trustee simultaneously served on their boards and audit committees.