Northern Ireland directors of fire engine firm banned for auditing scandal
Three businessmen from Northern Ireland who held senior roles in a company that leased fire engines to the London Fire Brigade have been banned from the accountancy profession and handed fines totalling half-a-million pounds.
John Shannon (52), Frank Flynn (54) and Matthew Boyle, executives at AssetCo plc, were censured by the Financial Reporting Council (FRC) over a scandal dating back to 2009.
A disciplinary tribunal found that the three committed misconduct when preparing and approving the group's financial statements for the years to the end of March 2009 and March 2010.
The finances were later restated in 2011, with a £146m reduction in assets and a £25m reduction in profit. It resulted in the AIM-listed company's share price collapsing from 60p to 1.75p.
The firm, which once supplied fire engines to more than 100 fire stations in the capital, had to be bailed out in 2011 before selling its UK business to focus on the Middle East.
The FRC said the misconduct was the most serious it had ever put before a tribunal, resulting in the lengthiest bans imposed to date.
Shannon had been chief executive of the firm, while Flynn had been chief financial officer. Boyle was financial controller.
The FRC's executive counsel brought a total of 27 allegations of misconduct against the three.
Chaired by Sir Bernard Eder, the tribunal made findings of misconduct in relation to them all.
It found the trio had acted with dishonesty and failed to act in accordance with core standards of integrity, objectivity and competence, which related to dealing with company funds, the preparation of financial statements, and the recognition of fictitious assets and revenue.
The tribunal also found that they had each misled the auditors, Grant Thornton UK LLP.
Last year the auditor was fined £2.3m for failing to challenge "fictitious revenues" at the firm.
As a result, Shannon was banned from the accountancy profession for 16 years and fined £250,000.
Flynn was excluded for 14 years and fined £150,000.
Boyle was handed a 12-year ban and ordered to pay £100,000.
Claudia Mortimore of the FRC said: "The misconduct of the three accountants is the most serious the FRC has put before a tribunal.
"These sanctions should send a clear message that the manipulation of financial statements, and in particular dishonesty, will be dealt with robustly."