At a creditors’ meeting on Friday, PricewaterhouseCoopers, administrators to the collapsed energy group, will lay out the options and give an estimate of how much can be feasibly recouped from the collapse.
At the top of the administrators’ agenda will be whether creditors should pursue the possibility of suing the auditors. Recoverable assets are estimated to be between £500 and £700m. Liabilities already exceed several billion pounds and the administrators have ‘a huge and complex task’ ahead of them.
As well as the financial claims, Andersen would potentially suffer further damage to its reputation if a hearing was to go through the courts. But one question that remains open is at whom creditors could direct any legal action.
A lawyer close to the profession said under UK law, Andersen could be viewed as a global entity, and not separate partnerships, so UK partners could be liable.
In response to the possibility of legal action in the UK, John Ormerod UK managing partner of Andersen told Accountancy Age: ‘There is no suggestion we have done anything wrong in relation to Enron Europe, so the thought of whether we could withstand claims is fanciful.’
Enron Europe’s four companies’ had 250,000 trading positions with 1,000 parties, said Neville Kahn, PwC administrator to Enron Europe. ‘There’s the problem of complexity of liabilities.’
The average cost of fraud increased 35.4% to £3.9m in 2016, compared to 2015 data
Harrison Beale & Owen will (HB&O) have a new chairman and managing director at the helm for 2017
Satvir Bungar promoted to managing director in the mergers and acquisitions team
Carolyn Brown appointed as the first head of client legal services practice RSM Legal