MF Global Holdings, which filed for bankruptcy in 2011 after risking a $6.3 billion bet on bonds from some of Europe’s most indebted nations, is suing PricewaterhouseCoopers (PwC) for $1 billion (£600,000), according to the WSJ.
In a complaint filed at Manhattan federal court, MF Global allege that PwC failed to advise them properly over their holdings of European sovereign debt, blaming them for the firm’s collapse, saying:
“But for PwC’s erroneous accounting advice, MF Global Holdings could not have — and would not have — invested heavily in European sovereign debt to generate immediate revenues and would not have suffered the massive damages that befell the company in 2011”
MF Global claims that PwC incorrectly advised them that they could account for debt investments made through “repurchase to maturity” transactions as sales rather than as secured financings, and so could immediately record the transactions as revenue.
PwC deny any professional wrongdoing and said in a statement that they were “disappointed that this meritless claim has been brought”.
