The long and sordid saga of the Hewlett-Packard (HP) acquisition of U.K. company Autonomy continues to percolate in new ways. Last month, U.K. regulator the Financial Reporting Council (FRC) announced it was filing formal complaints against the auditing work done by Deloitte and two former finance executives from Autonomy, Richard Knights and Nigel Mercer, over their failure to adequately challenge multiple issues with the firm’s accounts, specifically on the sale of hardware and its treatment under reseller contracts. 

For those who may not recall, HP bought Autonomy for just over $11 billion in 2011. Within 18 months, however, HP claimed it had uncovered a massive accounting fraud, which led to an over-evaluation of Autonomy by HP. HP then wrote off approximately $8.8 billion of the value of Autonomy and brought suit against Mike Lynch, the former CEO of Autonomy, and Sushovan Hussain, former CFO of the firm claiming fraud. The U.K. Serious Fraud Office investigated the HP purchase of Autonomy from 2013 to 2015, finding “insufficient evidence” to prosecute Autonomy’s executive team.

So, what’s changed? The U.S. Department of Justice took Hussain to trial in the spring of this year, and he was convicted of fraud for essentially running a “Ponzi scheme” with Autonomy and then lying about it to HP. How was it, then, that the U.S. Attorney’s Office for the Northern District of California was able to secure a guilty verdict from a jury when the U.K. SFO could not even find “sufficient evidence” to bring charges?

While that answer remains elusive, it does seem clear British regulators have been shamed into bringing some charges forward. In addition to the charges against Deloitte and the two former Autonomy audit partners Knights and Mercer, the FRC also brought charges against Hussain and Stephen Chamberlain, the former VP of finance at Autonomy for “acting dishonestly and/or recklessly” in preparing Autonomy’s accounts. What’s next? Stay tuned for how this plays out.