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London Auditor K&K Fined and Banned Over GFG Alliance Audits
The FRC fined King & King and its senior partner after audits of GFG-linked firms showed independence failures and ignored accounting red flags. The ban removes a key auditor from the GFG network.
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A six-partner audit firm in London lost its license to audit the largest public companies after the Financial Reporting Council found it ignored falsified accounts at businesses tied to Sanjeev Gupta's GFG Alliance.
The FRC ruling against King & King (K&K) and its senior partner Milankumar Patel, issued December 17, 2025, caps a probe into four audits conducted between 2019 and 2020. Both admitted the breaches.
K&K was fined £52,500 after a 25% discount for early admissions. Patel faces a total financial sanction of £326,184, including disgorgement of profits the FRC considered excessive. His Responsible Individual status has been withdrawn. He is banned from all statutory audit work for three years and cannot apply to return for two more years after that. K&K received a severe reprimand and is barred from the PIE auditor register for five years and from auditing large private companies for two years.
The FRC found that K&K's financial dependence on GFG destroyed its independence to challenge management. In 2019, 15% of K&K's income came from GFG. By 2021, that figure hit 41%. Patel personally earned £414,202 in 2020 and £463,265 in 2021 from GFG-related work, the FRC said. K&K checked whether any single GFG audit exceeded 10% of fees. Since none did individually, the firm concluded there was no problem. The FRC called that approach “flawed and artificial” and “obviously wrong.”
Beyond the independence failure, K&K failed to properly audit unusual income and expense items that turned loss-making companies into profitable-looking ones. The report highlights Speciality Steel, whose subsidiary SSUK recorded a £16.5 million provision for asbestos remediation and emissions liabilities in 2018. The financial statements were signed in March 2019. Three months later, management told K&K that £13.2 million of the provision was to be released, which transformed Speciality's £8.2 million loss before tax into a £5 million profit. K&K's own audit manager challenged management, noting the reversal “flips the company from a loss to a profit.” The GFG chief financial officer then called Patel directly, who forwarded the challenge email to colleagues, describing it as “a bit sensitive.” The challenge was dropped.