KPMG has begun its defence against a potential £12.5m fine for accounting failures dating back to the financial crisis.
The Times reports that the Financial Reporting Council and KPMG underwent a tribunal hearing yesterday over the audit firm’s decision to sign off BNY Mellon’s accounts.
The FRC claimed KPMG’s misconduct was a “truly exceptional case” that warrants the record fine, the paper reports.
As a custodian bank, BNY was charged with safeguarding £1 trillion of client assets from 2007 to 2011, but the FRC claims regulators were misled over its compliance with the rules by KPMG.
KPMG is looking to pay only a tenth of the fine, having recognised unintentional misconduct.
The spotlight has been turned back on the accounting giant, one of the four largest in the UK, after its role with construction company Carillion also drew attention after its collapse.
The next largest fine ever handed out over accounting failures involved BHS’ collapse, and landed PwC with a £6.5m bill.