Britain’s accounting watchdog has opened investigations into PwC and a smaller rival over audits conducted for Greensill Capital UK and the bank owned by one of its largest borrowers, the metals magnate Sanjeev Gupta. The Financial Reporting Council’s (FRC) investigations – launched on 15 June but only made public on Monday – add to a growing list of investigations linked to Greensill and its customers, after it fell into administration in March this year. The regulator revealed on Monday it was looking into work conducted by Saffery Champness, which audited Greensill Capital UK’s accounts between 2014 and 2019, over its audit of Greensill for the year ending 31 December 2019. The FRC is also scrutinising PwC over its audit of the 2019 accounts issued by Wyelands Bank, the lender majority-owned by Gupta, the billionaire boss of beleaguered manufacturer Liberty Steel UK. The regulator has the power to impose unlimited fines and even ban firms from conducting audit work if it uncovers wrongdoing. A spokesperson for Saffery Champness, which employs about 700 people in the UK, previously said the company had no communications with Greensill regarding the issues that led to its administration, and had not been involved in the audit of Greensill’s 2020 accounts. Greensill was reportedly searching for a new auditor last autumn, having agreed that the size and complexity of its balance sheet had outgrown Saffery Champness’s services. Saffery Champness is the 12th largest UK audit firm by revenue. However, several large firms rejected offers to take over the audit work, according to the Financial Times. Greensill Capital – which offered companies advances on invoices for a fee – collapsed this spring after insurers refused to renew contracts that underpinned billions of pounds worth of customer loans and helped keep Greensill’s complex financial operation afloat. The lender’s failure has since prompted at least a dozen parliamentary and regulatory investigations into supply chain finance, its use of emergency Covid loans, and Greensill’s ties with Gupta’s metals empire. Greensill, which employed David Cameron as an adviser, also prompted one of the largest lobbying scandals in a generation after it emerged that the ex-prime minister had pushed officials to give the firm access to emergency Covid loans at the height of the pandemic in 2020. PwC stood down as auditors of Wyelands Bank in November 2019, months after auditing the accounts now under investigation. PwC said it was concerned about the potential for a conflict of interest, but has declined to give more detail. Mazars took over as Wyelands Bank’s auditors in its wake. Wyelands Bank is currently on the hunt for a potential buyer but could face potential liquidation after the Bank of England forced it to hand money back to 4,000 savers earlier this year. In May, the Bank of England’s governor, Andrew Bailey, revealed that a Serious Fraud Office investigation into GFG Alliance – the loose umbrella of companies owned by Gupta – and its links to Greensill, was partly focused on Wyelands Bank, which has now ceased trading. “It’s understandable that there is regulatory scrutiny in situations like this. We will cooperate fully with the FRC in its enquiries,” PwC said. “We share the FRC’s commitment to audit quality and are two years into a wide-ranging programme to enhance audit quality across the firm.” Saffery Champness said it would also cooperate fully with the FRC and declined to comment further. “Audit quality is an absolute priority for Saffery Champness and we are committed to upholding the high professional standards our clients rightly expect.”