KPMG probed over bank audits

Accountancy giant KPMG is facing a potential investigation over the audit work that gave HBOS a clean bill of health in the run-up to its collapse.

KPMG probed over bank audits

Accountancy giant KPMG is facing a potential investigation over the audit work that gave HBOS a clean bill of health in the run-up to its collapse.

The UK's Financial Reporting Council (FRC) confirmed it would consider launching an investigation of KPMG’s role following last week’s damning Parliamentary Commission report in the UK on HBOS and once Britain's Financial Conduct Authority (FCA) presents its findings on the bank’s failure in the autumn.

It comes as a further blow to KPMG after it was forced to quit yesterday as auditor of two US firms – nutritional products group Herbalife and footwear maker Skechers – amid an FBI investigation into alleged insider trading involving a former employee.

KPMG, which audited HBOS’s accounts throughout the years leading up to the financial crisis, said: “We stand by the quality of our audit work at HBOS.”

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