KPMG in investors' backlash.
Big Five firm faces action over audit work of collapsed insurer Independent
KPMG is waiting to hear whether it will face legal action for its work as auditor at collapsed insurer Independent, headed by CEO Michael Bright, writes Gavin Hinks.
Creditors of Independent have formed an action group with City solicitors Class Law with the intention, it is understood, of launching a multimillion pound action against the firm and other targets.
Class Law, a specialist in financial class actions, has appointed legal counsel and is taking advice on its next step. The interests of policyholders, trade creditors, employee shareholders and other shareholders are all under consideration.
KPMG said this week it had not been in direct contact with Class Law.
A spokesman said: ‘We’ll wait and see the exact terms of what they come up with.’
Independent collapsed in June this year with what were termed ‘unquantifiable losses’. Provisional liquidator PricewaterhouseCoopers is expected to clarify the state of Independent’s balance sheet within the next few weeks.
In recent weeks observers have used the plight of Independent to support calls for an independent body to appoint auditors instead of company directors.
For more on Independent, see page 25