Regulator to probe Greensill and Wyelands Bank audits
The Financial Reporting Council is to investigate recent audits of both Greensill Capital UK and Sanjeev Gupta’s Wyelands Bank, it emerged on Monday.
PwC - one of the UK’s so-called Big Four accountants - is being probed in relation to the audit it carried out of Wyelands Bank financial statements for the year to 30 April 2019. Saffery Champness is to be investigated over its audit of Greensill’s accounts for the year to 31 December 2019.
Wyelands is part of GFG Alliance, which is controlled by steel tycoon Gupta and is one of Greensill’s biggest borrowers.
PwC said it would co-operate fully with the probe. "We share FRC’s commitment to audit quality and are two years into a wide-ranging programme to enhance audit quality across the firm," it said.
Saffery Champness said: "Audit quality is an absolute priority…and we are committed to upholding the high professional standards our clients rightly expect." It too said it would co-operate fully with the FRC.
Earlier this year, the Bank of England made Wyelands return around £200m of deposits to savers over concerns about how the bank was financing GFG Alliance.
Greensill, a supply chain finance specialist, filed for insolvency shortly afterwards, after it lost insurance cover for its debt re-packaging business and said GFG had started to default on its debts.
The Serious Fraud Office has since launched an investigation into "suspected fraud, fraudulent trading and money laundering" relating to companies within GFG, including the financing arrangements it had with Greensill. The Bank of England is also investigating whether Gupta is a "fit and proper" owner.
Former prime minister David Cameron was caught up in the scandal after it emerged he had been lobbying chancellor Rishi Sunak, along with others in government, on behalf of Greensill.