The auditors of the collapsed Christmas savings club Farepak have been ordered to pay more than £1 million in fines and costs.
The company, which was based in Swindon, Wiltshire, went into administration in 2006 leaving 116,000 people with total losses of £37 million - each losing on average about £400.
Farepak, which was set up in 1969, allowed customers to pay in money on a monthly basis to secure hamper deliveries at Christmas.
The Financial Reporting Council has fined Ernst & Young £750,000 and told them to pay costs of £425,000.
Auditor Alan Flitcroft, who worked for the accountants, was fined £50,000.
Ernst & Young and Mr Flitcroft, who were also formally reprimanded by the FRC, admitted their auditing fell below the expected standard.
Paul George, executive director of conduct at the FRC, said: "The FRC is pleased with the outcome of this case, which sends a strong clear reminder to all accountants and accountancy firms that they have a responsibility to carry out their professional work with due skill, care and diligence in the audit of subsidiary entities and obtain corroborative evidence to support management representations.