Administrators of collapsed brokerage MF Global have filed a $1bn suit against PwC US for the alleged $6.3bn European sovereign debt investment advice and subsequent malpractice, which the claimant said contributed to the company's bankruptcy in 2011.
The suit filed in a US District Court in Manhattan accuses PwC of professional malpractice by offering bad advice concerning the off-balance-sheet accounting treatment for the debt.
The administrators accuse PwC of knowing the investment would add significant risk to MF Global's finances and said that the company would have not taken in the investment had it received sound advice.
PwC described the suit as a "meritless claim" as the accounting treatment that is the subject of the suit has been examined by trustees, regulators and a congressional committee.
In February MF Global costumers' class action suit against PwC was dismissed by a federal judge on claims of professional negligence.