Six and a half years after Robert Maxwell fell off his yacht, the JDS finally announced yesterday that it was proceeding to tribunal with a number of unpublished findings against Coopers & Lybrand, the firm that audited most of Maxwell's interests. The nub of the complaint is that by August 1991, three months before Maxwell died, the firm should have had sufficient evidence of fraud and malpractice to warrant either resigning as auditor or alerting the authorities. Most of us would find this a far from revelatory finding. How could it have taken the JDS so long?
To be fair, the JDS does seem to be going a bit faster than some of its statutory counterparts. The Department of Trade and Industry report into the flotation of Mirror Group has still to see the light of day. Furthermore, civil proceedings over the collapse and the emergence of a conflict of interest meant the JDC's investigation didn't get properly under way until 1995. So maybe it isn't doing too badly. All the same, Chris Dickson, executive counsel to the JDS, must be acutely aware of the criticism of slowness.
Meanwhile, it is the unfortunate lot of Coopers and Lybrand that this has become something of a show case. The accountants have to demonstrate that self regulation can work if they are to defend their system. Coopers and the four partners the JDS has chosen to nail to the cross can therefore expect the harshest penalties to be imposed should the case stick. And because proceedings before the tribunal continue for the time being to be held in private, the public isn't going to have much confidence in any outcome other than guilty as charged. Self regulation may have its virtues, but for obvious reasons, it can be prone to bad justice.Reuse content