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Corporate Business

Record £14m Fine Over MG Rover and Phoenix

Accountants Deloitte were today punished with a record £14 million fine for failing to manage conflicts of interest over their advice to collapsed car maker MG Rover. The Financial Reporting Council also severely reprimanded the firm for its conduct over MG Rover, which crashed into administration in 2005 with debts of £1.4 billion and 6,000 job losses. Its damning report said: “These are all very serious matters. The public must be protected from misconduct of this nature.” Four MG Rover directors — the “Phoenix Four” — set up the Phoenix company to buy the loss-making British carmaker for a token £10 five years earlier. But Deloitte and its partner and corporate finance expert Maghsoud Einollahi — personally fined £250,000 and banned from the profession for three years — both failed to properly manage conflicts of interest, the FRC said. Einollahi […]