FRC launches probes into MFS auditors after firm's collapse

(Sharecast News) - The Financial Reporting Council has launched an investigation into three accountancy firms and several individuals linked to the collapse of the mortgage lender Market Financial Solutions earlier this year. The FRC said it has commenced probes into Magus Chartered Accountants, Berkeley Finch Limited, and Silver Levene (UK), and a number of accountants, relating to potential auditing failures in the firms' work on MFS and other connected companies.

The investigations follow allegations of fraud involving the mortgage lender's founder Paresh Raja, after the firm failed to repay £1.3bn to a group of lenders before falling into administration in February.

The FRC, which kicked off an enforcement investigation into MFS directly in March, said it made the decisions to open investigations at a conduct committee meeting on 21 April, and that all probes will be carried out by its executive counsel.

"It would not be correct or fair to treat any part of this announcement as constituting or evidencing an investigation into any other persons or entities," the watchdog said in a statement.

"The opening of an investigation does not indicate that the Financial Reporting Council has made, or will make, any findings of breach of relevant requirements or misconduct."