Subprime lender Cattles has launched a multimillion-pound High Court claim for damages against PwC alleging failings in the way the Big Four firm audited its accounts.
Cattles, which is currently being wound down, claims PwC failed to spot danger signs in its accounts during audits in 2006 and 2007. Mis-stating the financial position of the company led to it accumulating £1.6bn in debts and liabilities.
A High Court date is expected to be set for early next year.
A spokesperson for the company confirmed that “after a thorough, independent and objective review of the merits of this claim, it is clear to us that PwC were negligent in their role as auditors. As a consequence, Cattles and its creditors suffered very significant losses.”
PwC has vigorously denied the allegations: “We are disappointed that this claim has been issued given the FSA's censure of the company for market abuse.” PwC added that it was an “inflated and misguided” claim.