A senior executive at PwC has been named in a £63m court case against the Big Four accounting firm in which it is accused of leaking confidential client information.
The firm denied that Ian Green, formerly head of PwC in the north of England, provided a business associate with information about a dire financial situation at Watchstone, an insurance business that had hired PwC for advice on a financial restructuring.
The business associate was working for Slater & Gordon, an Australian law firm that was in talks to buy the professional services business of Watchstone, formerly known as Quindell. In August, Watchstone sued the Big Four firm for allegedly conspiring against it by releasing confidential information to Slater and Gordon.
PwC named Mr Green for the first time in its defence filing made last week, but denied he had conspired to help Slater and Gordon pay less for Quindell. Watchstone claims that Slater and Gordon was able to cut £63m off the price it paid for the company because confidential information was shared.
Mr Green, who has been a partner at PwC for almost 20 years, is the latest executive at a major accounting and advisory firm to face scrutiny. Last year, scandals involving a string of partners at PwC, KPMG, EY and Deloitte raised concerns about culture at the Big Four. Mr Green has stepped down from his role running the north of England practice but remains a partner at PwC.
Watchstone alleges the information was given to an executive at investment bank Greenhill named Gareth Davies. In its defence filing, PwC admitted that Mr Green met Mr Davies for a “short and informal coffee meeting” in January 2015 — two months before Watchstone was sold — but denied that Mr Green divulged confidential information relating to the company.
“Mr Green and Mr Davies had a general catch-up and Mr Davies also raised the subject of the Quindell/Slater & Gordon transaction,” PwC admitted in its defence. It claimed Mr Green did not know in advance of the meeting that Mr Davies “intended to discuss the Quindell/Slater & Gordon transaction”.
It also rejected allegations made by Watchstone that the firm, through Mr Green “or otherwise”, gave Mr Davies “confidential information”, including that Quindell would “run out of cash in mid-2015”.
Last year, Mr Green took over as PwC’s leader for the north of England as part of a regional shake-up.
The legal battle is one of two major spats to arise from Quindell’s ill-fated acquisition by law firm Slater and Gordon four years ago, which collapsed into scandal when Quindell revealed a dramatic misstatement in its accounts. The £80m profit it had declared was actually a £375m loss, resulting in an ongoing UK fraud investigation.
PwC said: “We deny these allegations and are vigorously defending this claim. It would be inappropriate to comment further on an ongoing legal matter.”