The Financial Reporting Council has opened formal investigations into four audit-related matters connected to Market Financial Solutions (MFS), the mortgage lender that collapsed into administration in February 2026 following fraud allegations and claims that more than £1.3 billion was misappropriated from the business.

The regulator said on Thursday that it was investigating the conduct of Magus Chartered Accountants and three individual accountants, alongside the statutory audits carried out by Berkeley Finch and Silver Levene (UK) for the 2024 financial year. The decisions to launch the probes were taken by the FRC’s Conduct Committee on 21 April and will be overseen by its executive counsel.

According to the FRC, Berkeley Finch is being investigated over its audit of MFS’s 2024 financial statements, while Silver Levene faces scrutiny over its audit of the consolidated accounts of Zircon Group, a company connected to MFS. The regulator is also examining the conduct of Magus and individual accountants in relation to MFS and associated businesses.

The investigations mark the latest escalation in the fallout from the collapse of MFS, a specialist provider of buy-to-let mortgages and bridging finance that funded lending through borrowings from banks and institutional lenders rather than customer deposits. Creditors who lent more than £2 billion to the wider group have alleged extensive wrongdoing following its insolvency.

Several small accountancy firms signed off accounts across different parts of founder Paresh Raja’s lending network, with no single consolidated group audit undertaken by a major accounting firm. Berkeley Finch, which signed off MFS’s 2024 accounts with an unqualified opinion, had 11 employees that year, according to its own filings.

Creditors cited in court filings have alleged that at least £1.3 billion was misappropriated from MFS and that Raja and his wife received more than £408 million from funds managed by the company into personal bank accounts in multiple jurisdictions. Raja is subject to a worldwide freezing order.

A spokesperson for Raja said: “Assets which the administrators characterise as missing were held through nominee structures for the benefit of MFS and its creditors, a position set out in detail to the administrators in March 2026.” The spokesperson added that Raja “has consistently maintained there was no fraud or dishonesty”.

The FRC said that opening an investigation does not mean any findings of misconduct or breaches have been made. Silver Levene said it would “co-operate fully” with the investigation, while Berkeley Finch and Magus did not immediately respond to requests for comment.

---