Carillion liquidators secure funding to take KPMG to court for audit failures
Carillion’s liquidators have secured a £250m funding deal with a litigation funder to take KPMG to court for audit failures.
Litigation Capital Management (LCM) will fund a claim against the Big Four firm in the Commercial Court of the High Court.
Carillion’s liquidators are taking KPMG to court for perceived audit failures, resulting in losses expected to exceed £250m, LCM said.
Carillion collapsed in January 2018 with liabilities of almost £7bn after a series of financial troubles caught up with the outsourcing giant.
The group’s failure was the largest corporate collapse in the building and construction industry in UK history.
KPMG is under investigation by the audit watchdog for its work on Carillion.
City PM understands Carillion’s liquidators have not yet filed the lawsuit against KPMG.
KPMG’s role in the scandal, alongside various other major company collapses in recent years, has provoked criticism of the UK’s audit sector, and doubts it is living up the standards expected by the general public.
LCM executive vice chairman Nick Rowles-Davies said: “This investment demonstrates LCM’s prominence and pedigree in the disputes finance industry and in particular, LCM’s position as funder of choice in the UK insolvency market and we are delighted to be supporting thousands of creditors who have suffered as a consequence of the biggest insolvency in recent UK history.”
KPMG declined to comment.