John Connolly, the chief executive of Deloitte UK, was faced with a call to resign yesterday by a member of the influential House of Commons Treasury Select Committee following reports of his involvement in the Barlow Clowes savings scandal.
Norman Lamb, a Liberal Democrat Treasury spokesman, said Mr Connolly should step down after it was revealed that he had been heavily criticised in 1995 by the accountancy watchdog over his role in the Barlow Clowes affair.
Mr Connolly was officially reprimanded over his accountancy work related to Barlow Clowes by the accountancy profession's Joint Disciplinary Scheme (JDS). It criticised him for his lack of professional efficiency, conduct and competence when the official report into the collapse of Barlow Clowes was published in 1995.
Barlow Clowes cost the government £150m in compensation to thousands of mainly elderly savers after the investment group collapsed in 1988.
The call for Mr Connolly to resign comes as Deloitte is facing further pressure over its role in the €10bn (£7bn) Parmalat scandal in Italy. Two partners in its Italian practice have been placed under investigation by prosecutors.
Neither Deloitte's London office nor Mr Connolly are involved in the Parmalat case.
Mr Lamb said: "In terms of restoring confidence both generally and in terms of Deloitte, it seems to me Mr Connolly's position is no longer tenable. For someone in charge of their UK operation to have been so heavily criticised by a financial watchdog seems extraordinary."
Deloitte yesterday said the Barlow Clowes affair was in the past and that Mr Connolly had been elected to his current role by partners who were fully aware of the matter. "This refers to a piece of work carried out back in the 1980s and the findings of the JDS report have been in the public domain since 1995," Deloitte said.