The UK Financial Reporting Council (FRC) today confirmed that it has commenced investigations into the audits of London Capital & Finance (LCF).

The investigations will cover the audits for the one month period ended 30 April 2015 (carried out by Oliver Clive & Co.), the year ended 30 April 2016 (carried out by PwC) and the year ended 30 April 2017 (carried out by EY).

The probe will be conducted by the FRC’s Enforcement Division under the Audit Enforcement Procedure.

LCF collapsed 18 months ago after the Financial Conduct Authority froze its bank accounts and said its marketing of unregulated mini-bonds promising returns of 8 percent was misleading.

The company’s creditors are owed a total of £236m. They are expected to get back just 25 per cent of this amount they put into the firm after it emerged that millions of pounds went into the personal possession of four executives.

The UK Financial Conduct Authority (FCA) has earlier this month unveiled proposals to make permanent its ban on the mass-marketing of speculative illiquid securities, including speculative mini-bonds, to retail investors. The ban came into effect in January 2020, and was initially set to last for 12 months.