JP Morgan starts European audit review

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NEW YORK, NY - OCTOBER 02: People pass a sign for JPMorgan Chase & Co. at it's headquarters in Manhattan on October 2, 2012 in New York City. New York Attorney General Eric Schneiderman has filed a civil lawsuit against JPMorgan Chase alleging widespread fraud in the way that mortgages were packaged and sold to investors in the days that lead-up to the financial crisis. The allegations, which were filed in New York State Supreme Court, concern business that transpired during 2006 and 2007 at a now-defunct Bear Stearns, the failed Wall Street firm which was purchased in 2008 by JPMorgan Chase. (Photo by Spencer Platt/Getty Images)

JP Morgan Chase has reportedly launched a review into its current relationship with auditors for its major European arm.

The Wall Street giant has kicked off a process to look at the role currently held by PricewaterhouseCoopers (PwC) as the accountant of JPMorgan Securities.

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PwC, which has been JP Morgan’s auditor for the last 10 years, could still retain the business as the incumbent auditor as it is not captured by rotation rules at this point in time.

Sources told Sky News, which first reported the review, that PwC’s relationship with the New York-listed JPMorgan Chase is not under review.

According to the broadcaster, a number of other JPMorgan-owned entities in Europe have been carrying out an audit tender process on the basis that a new firm will have to be appointed as PwC has been in place for two decades.

In May fellow Wall Street investment bank Goldman Sachs looked beyond the Big Four accountancy groups by selecting Mazars, the UK’s eight largest auditor, as its beancounter.

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The new appointment to the role, which had previously also been held by PwC, came in the wake of new European audit regulations aimed at breaking the dominance of the Big Four over the listed audit market.

JP Morgan declined to comment.