The "Big Four" accounting firms' dominance over corporate audits in Britain will be investigated after an antitrust regulator said the market is bad for customers and small competitors.

The U.K. Office of Fair Trading, which has examined the issue since 2002, referred the matter today to the Competition Commission to find any distortions in the industry and potentially force changes. The probe will focus on KPMG LLP, Deloitte LLP, Ernst & Young LLP and PricewaterhouseCoopers LLP.

"The market for large company audits lacks sufficient competition and does not work well for customers," John Fingleton, the OFT's chief executive officer, said in the statement. "It is highly concentrated, largely supplied by four big firms, with clients rarely switching between auditors."

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