The owner of the Welcome Finance consumer
loans firm has sacked six senior bosses following a probe into a £700m black hole in the company's accounts.
Cattles executives, including finance director James Corr and chief operating officer Ian Cummine, have left following "a breakdown in controls" which resulted in its policies on bad debts being applied incorrectly.
The policy is thought to have seen the deferring and extending of repayment terms on under-performing loans to avoid making a loss provision in the accounts.
Cattles uncovered the breakdown in controls in February and warned in April that provisions for 2008 and previous years would be £700m higher than expected.
The Financial Services Authority (FSA) is understood to have details of the probe by Deloitte and Freshfields and considering whether to take further action.
Shares in Batley-based Cattles are suspended after the firm delayed its annual results to resolve the accounting crisis.
The firm is also facing deadlines on its £2.4bn debt burden.
It must soon make payments to bondholders as well as re-finance £500m in wholesale funding with a bank consortium led by Royal Bank of Scotland by July 14.
Cattles is pushing for a "standstill agreement" which will see these payments suspended while it resolves its future.
Cattles' main Welcome Finance business is still up and running but has suspended lending to new customers in order to conserve funds.
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