London’s Financial Reporting Council has imposed a fine and a ban on audit firm King & King after an investigation uncovered “serious, numerous, and pervasive” breaches linked to the GFG Alliance group.
Regulators detail the sanctions
The FRC’s ruling, issued on 17 December 2025, targets the six‑partner firm and its senior partner Milankumar Patel, who holds more than 60 % of the company’s voting rights. Both parties admitted to breaching fundamental audit principles in four engagements covering GFG subsidiaries between 2019 and 2020.
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Patel’s personal sanctions total £326,184. He lost his audit‑signing rights. The firm itself received a £52,500 fine after a 25 % discount for early admission, a severe reprimand, and a five‑year exclusion from the public‑interest entity (PIE) auditor register.
Independence compromised by fee dependence
The investigation highlighted that King & King grew financially dependent on GFG. In 2019, the group contributed roughly 15 % of the firm’s total income; by 2021 that share had risen to 41 %.
When asked whether any single audit exceeded a 10 % fee threshold, the firm answered no, reasoning that none of the engagements alone crossed the limit. The regulator called this “flawed and artificial” and “obviously wrong,” noting that the cumulative reliance eroded the auditor’s independence.
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External commentary on the failures
Jonas Rey, founder of corporate‑intelligence firm Athena Intelligence, told Trade Finance Global that warning signs had existed for years, including undisclosed related‑party transactions and trades lacking commercial rationale. He suggested that the auditors “missed obvious red flags,” though he stopped short of assigning criminal intent.
Broader context of the GFG crisis
The GFG Alliance’s troubles intensified after its main lender, Greensill Capital, collapsed in 2021, cutting off a key credit line. The fallout raised questions about the substance of GFG’s financial statements and the reliability of its reported performance. The regulator’s website notes that the firm’s audits were not alleged to have produced misstated accounts; rather, the auditors failed to perform sufficient work to verify the figures.
Following the FRC’s decision, the audit practice stepped down from all remaining GFG engagements in 2022. It had also served as auditor for NMC Healthcare, a Dubai‑based chain that defaulted in 2019, with Greensill involved in that collapse as well.
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The firm said it accepted the findings and would “review internal controls” to prevent future lapses.
Regulators say the case highlights the importance of auditor independence when a client contributes a sizable share of fees.