Regulator says PwC could face £34m fine, FT reports

30 November 2011

PricewaterhouseCoopers (PwC) could be fined as much as £34 million for reporting failures surrounding JPMorgan’s securities unit, a news report has revealed.

According to Financial Times, the Accountancy & Actuarial Discipline Board (AADB) is seeking to levy a fine not “vastly disproportionate” to the £33.3 million JPMorgan faced last year for failing to ensure client assets were segregated.

PwC was the unit’s auditor and failed to spot the error which led to the imposition of the record-breaking fine.

In a statement, PwC said: "We acknowledge that we did not maintain our usual high standards. PwC takes very seriously its reporting requirements to the FSA. We hope that the regulatory response will be proportionate to the issue.”

Tim Dutton, lawyer working on behalf of PwC, called for any fine to be no more than £1 million as the mistake made by the auditor was genuine.

PwC had not lost any client money and there was little risk to the unseparated funds, he claimed.

The FSA levied its largest ever fine on the JPMorgan unit in June 2010 for failings in its segregation of client funds between November 2002 and July 2009.

By Jim Ottewill

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