Consulting firm McKinsey & Co. is winding down its bankruptcy practice after numerous lawsuits and government investigations concerning the division’s work advising troubled borrowers, The Wall Street Journal reported. Some McKinsey partners who had previously focused on bankruptcy advisory work in the firm’s recovery and transformation services, or RTS, division have either been leaving the firm or pivoting to other kinds of work. A McKinsey spokesman said that RTS isn’t being shut down, and that while layoffs have been occurring among non-client-facing staff, it isn’t laying off consultants. “McKinsey RTS is a part of our broader transformation practice which continues to grow and serve clients around the globe,” said the spokesman, who confirmed that the company isn’t currently doing any chapter 11 engagements. McKinsey has faced years of private lawsuits and government probes into the firm’s work in the bankruptcy space, including whether it failed to disclose potential conflicts of interest and guard against insider trading involving companies the firm was advising. (Subscription required to view article.)
