Coopers’ Barings settlement collapses

A spokesman for Ernst & Young, Barings’ liquidator, confirmed that a definite agreeement had not been reached and it was now proceeding on the basis that a court action against Coopers & Lybrand, the collapsed bank’s auditor, would go ahead later in the year.

Last month it reached a settlement in principle with Coopers, now part of PricewaterhouseCoopers, over its role in the collapse of the merchant bank.

The settlement, rumoured to be between £70m and £120m, was expected to be finalised this month in court.

Coopers will now join Deloittes, also a Barings auditor, in court later this year where the two firms will defend their audit work against E&Y’s £1bn negligence claim in October.

A statement issued by Rick Murray, legal adviser to Deloitte & Touche Singapore, said: ‘The fact that Coopers & Lybrand and the claimants could not agree a settlement is no concern of ours. But the manner in which they failed is of great concern.

‘They had four years to conclude their disagreement before the long scheduled trial.

‘To launch a settlement effort on the eve of trial, which caused the court to believe for six weeks that an agreement was a breath away and then declare it all hopeless on the eve of the court’s summer recess implies at least irresponsibility.’

‘There may of course be a credible explanation for this bizarre course of events. But as all was conducted in secrecy, we will never know. And so the 12 Singapore partners of Deloitte & Touche who are parties to this case are entitled to their inevitable frustration.’

A spokesperson for PricewaterhouseCoopers said: ‘The collapse of talks is a matter of regret but we remain ready for trial now.’

PwC maintains that the collapse of Barings was due to management failure and fraud, not the work of the auditors.


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