PwC fined £15m for not reporting suspected fraud at firm

Business

The accounting giant PwC has been fined £15m by the financial conduct regulator in its first-ever financial penalty on an audit firm.

One of the so-called big four accounting firms, PwC was said by the Financial Conduct Authority (FCA) to have missed a number of audit red flags and failed to act immediately to report suspected fraud at a failed financial services firm.

PwC were the auditors of the firm, called London Capital & Finance (LCF), and were tasked with verifying company accounts.

But despite suspecting LCF was committing fraud and being obliged to report the suspicion to the regulator, PwC signed off on the accounts.

Money blog: Fines for parents taking children out of school to change

Even after it was satisfied that LCF’s 2016 accounts were accurate PwC still had a duty to report previous concerns, the FCA said.

PwC should instead have “acted immediately”, the FCA said. “Their failure to do so deprived the FCA of potentially vital information.”

More on Pwc

Who are the company PwC suspected of fraud?

LCF has been described as a Ponzi scheme by its former investors. It has also been condemned by the financial watchdog for its “unfair and misleading” promotion of a financial product called minibonds.

It entered administration after the FCA ordered it to remove those promotions in 2019.

Responding to the fine PwC said: “We have reached a settlement with the FCA to resolve an unintentional reporting breach.”

This breaking news story is being updated and more details will be published shortly.

Please refresh the page for the fullest version.

You can receive breaking news alerts on a smartphone or tablet via the Sky News app. You can also follow @SkyNews on X or subscribe to our YouTube channel to keep up with the latest news.

Articles You May Like

Volvo CE opens new facility to support production of electric wheel loaders
Schools closed and people urged to ‘lock doors’ as search for gunman enters third day
U.S. crude oil falls to lowest level since June 2023, posts worst week in nearly a year
Amazon is opening Fresh supermarkets after yearlong stall — but many locations remain vacant
Amazon makes £8 billion UK investment to build cloud and AI infrastructure