The Financial Reporting Council (FRC) has announced a formal investigation under the Accountancy Scheme into the conduct of Chris Willford, the former group finance director at Bradford & Bingley (B&B) who has faced criticism over his handling of information during the bank's failed rights issue five years ago.

The decision follows a ruling by the Financial Conduct Authority (FCA) in December 2013 which saw Willford handed a £30,000 fine for failing to update the bank's board about its deteriorating financial position during an emergency cash call at the height of the financial crisis.

The earlier FCA action centred on three days in May 2008 when B&B was embarking on a £400m rights issue which was restructured three times and eventually failed. Willford, who was finance director between October 2005 and June 2009, received information on 16 May 2008 indicating that B&B's financial outlook might be weaker than expected and out of line with previous forecasts.

The data Willford received included details on increases in the money set aside against impairments, a rise in arrears and repossessions over the previous three months, and a fall in the bank's net interest margin. The FCA said Willford should have immediately raised these issues with B&B's board and investigated to ensure that the information provided to shareholders on 19 May was correct. It described his failure to investigate potentially material risks as evidence of a lack of due skill, care and diligence.

However, the FCA concluded that Willford's conduct was not responsible for a profits warning in June 2008, the failure of the rights issue, or B&B's subsequent nationalisation.