Action has been taken against Deloitte for advice it gave to the Phoenix Four and MG Rover
A record £14 million fine has been handed down to accountancy firm Deloitte for the way it managed conflicts of interest in the collapse of MG Rover.
The Financial Reporting Council's report noted that the firm had failed to manage several conflicts of interest between its involvement with former MG Rover Directors John Towers, Nick Stephenson, John Edwards and Peter Beale - collectively known as the Phoenix Four - and its involvement with the MG Rover company.
Deloitte acted a advisor to both MG Rover and the four directors, which the FRC says was a serious conflict of interest.
The fine is the largest ever to be given by the Council, which says that Deloitte showed a 'persistent and deliberate disregard' for accountancy ethics. Deloitte has reportedly already had to pay £1.75 million towards court costs.
In a statement Deloitte said "We remain disappointed with the outcome of the Tribunal and disagree with its main conclusions. As a firm we take our public interest obligations seriously in everything we do. We are disappointed that the efforts we and others made did not successfully secure the long term future of the MG Rover Group."
The executive director at the FRC, Paul George, told industry magazine Accountancy Age that "The sanctions imposed are in line with the FRC's aim to ensure penalties are proportionate and have the necessary deterrent effect to prevent misconduct and bolster public and market confidence."
Former Deloitte partner Maghsoud Einoallahi was also banned from accounting for three years and fined £250,000.