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Accountancy firms to face more professional negligence claims

Published on 29 Mar 2010 under category: legal

Established accountancy firms in the UK are facing more professional negligence claims, according to new research reported in The Times.

The law firm behind the research claimed that there had been 13 negligence claims against firms last year, as opposed to four in the previous five years.

Several high profile accountancy firms have been criticised for their role in the financial crisis, though it is only recently that UK auditors have come under scrutiny.

Ernst & Young may potentially face legal action for its professional standards in its auditing of the collapsed Lehman Brothers, highlighted in a recent report by examiner Anton Valukas.

The newspaper reports that high-profile cases have been mostly unsuccessful, with one case against Moore Stephens being thrown out by the law lords.

Though it is harder to sue firms in the UK successfully, accountancy firms can still be held fully liable for losses – which could mean that companies in the UK will face a wave of law suits for professional negligence, in the wake of the financial crisis.

If you require advice on Professional Negligence please call us on +44 (0)20 7831 0101 and ask for Peter Mellett.