PricewaterhouseCoopers (PwC) has been accused of having a conflict of interests as the auditor of crisis-stricken bank Northern Rock.
According to a report in the Observer, the Big 4
accountancy giant has earned fees for helping Northern Rock to sell loans and borrow additional funds that outweigh those accorded for its services as an auditor.
In an annual report published by the bank, £700,000 of PwC's earnings was for "non-audit fees"; this figure compares unfavourably with the £500,000 in audit fees.
Vince Cable, the Liberal Democrat Treasury spokesman, called the situation a "serious conflict of interest".
"I would worry about the fact that the auditor appears to be making enormous fees from what turned out to be the most disastrous aspects of the Northern Rock situation," he told the publication.
The Northern Rock homepage is currently displaying a permanent message from the company in an attempt to assure customers that their money is safe.
© Adfero Ltd
