Arthur Andersen could face a formal investigation following its appointment as administrative receiver to bankrupt engineering company TransTec. The Big Five firm was appointed last month when the company, founded by former minister Geoffrey Robinson, collapsed with debts of more than £70m. It has been accused of breaking English ICA rules by accepting the work. Several insolvency sources have raised objections to the appointment because of Andersens’ previous corporate finance work for TransTec. A year ago, the firm assisted in a £32m disposal of the company’s measurement business. This could place the firm in breach of institute ethical guidelines that state a firm should not accept an insolvency appointment if an employee has carried out any ‘material professional work’ for the client in the preceding three years. One senior regulator said: ‘I would have thought that £32m would be material and presumably they were hoping to get additional work as well.’ An Andersens’ spokesman vigorously denied there had been any wrongdoing, describing it as a one-off deal. He added that the three individuals appointed to the receivership – Murdoch McKillop, John Talbot and David Duggins – had considered the position carefully before accepting the job. A source close to the institute’s ethical standards office said that an investigation did not require a formal complaint to be made, but could be triggered because of the high-profile nature of the case.
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