US vulture funds, the main creditors of the collapsed bank, last week succeeded in forcing Ernst & Young to resign as its liquidator. KPMG will take over, but the firm has just a fortnight to get to grips with the £1bn negligence claim against Coopers & Lybrand and Deloitte & Touche over their roles as auditors of Barings. The trial is due to start on 2 October.
The new liquidators will be helped by the fact that legal teams are staying in place.
But judicial issues and legal wranglings between E&Y and Barings’ creditors remain unresolved. As Accountancy Age went to press, all parties were due to attend a ‘security for costs hearing? in which the judge must ensure that there is collectively enough money to pay out in the event the defendants win.To conclude E&Y’s resignation, a parallel case management hearing is due to take place today.
The judge can either rubber-stamp the change-over of liquidators or make E&Y hold a creditors’ meeting. If the latter is decided, observers speculate the trial could be pushed back again.
But, Richard Heis, KPMG’s liquidator in charge of the case, told Accountancy Age: ‘There will be no impact on the start date of the trial due to the change-over.’
Meanwhile, an appeal by Coopers, now part of PricewaterhouseCoopers, against findings of the accountancy profession’s main watchdog is due to end this week. A judgement is not expected for several months.
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