Tribunal cuts Deloitte fine over MG Rover dealings by £11m

The fine imposed on Deloitte relating to its dealings with collapsed carmaker MG Rover has been cut by £11m, in a blow to the UK accountancy watchdog the Financial Reporting Council on one of its most high-profile cases in recent years.

The case, which now ends after a decade, relates to Deloitte's advice on two transactions connected to MG Rover, which collapsed into administration in 2005. In January, an appeals tribunal quashed the FRC's finding that there had been deliberate misconduct at Deloitte. The tribunal also threw out eight of 13 charges against Deloitte.

On Monday, an appeals tribunal announced that Deloitte's fine has been reduced from £14m to £3m. It also rescinded the exclusion order against Deloitte's former partner Maghsoud Einollahi and reduced his fine from £250,000 to £175,000. But the tribunal still reprimanded the firm and Mr Einollahi.

The revised fines will leave the UK accountancy body the Institute of Chartered Accountants for England and Wales, which helps fund the FRC, out of pocket. The ICAEW will receive the £3m Deloitte fine plus the £175,000 individual fine, but it has paid £5.3m towards funding the FRC's disciplinary activity in the Deloitte/MG Rover case.

A spokesperson for Deloitte UK said: "Reducing the sanctions imposed by the original tribunal was never a motivation in our appeal. We welcome the decision to overturn the exclusion of our former partner and accept the revised sanctions outlined by the appeal tribunal."

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