The UK’s Financial Reporting Council (FRC) says it has initiated an investigation into several small accountancy practices that worked for collapsed mortgage lender Market Financial Solutions (MFS).
According to a Financial Times (FT) report, MFS and a series of entities owned by founder Paresh Raja went into insolvency in February
Creditors that had reportedly lent more than £2bn ($2.6bn) to the group have since alleged fraud. The collapse has sharpened scrutiny of underwriting in asset-backed lending. Different parts of Raja’s lending businesses were audited by a number of small practices rather than through a single consolidated group audit by a large company.
The FRC is investigating Berkeley Finch, which issued an unqualified opinion on MFS’ 2024 accounts, and Silver Levene, which audited Raja’s Zircon Group in 2024. Berkeley Finch received £72,375 for its 2024 audit of MFS. When MFS failed, it owed money to Barclays and to a unit of Apollo Global Management.