Allen & Overy is being investigated by the Office for the Supervision of Solicitors (OSS) over an allegation that it breached conflict of interest rules during the Safeway bid earlier this year - despite the fact that there is no official complaint.

In January, the magic circle firm accepted instructions from Dresdner Kleinwort Wasserstein - the financial adviser to Safeway bidder Wal-Mart - while already acting for ABN AMRO, the financial adviser of rival bidder WM Morrison.

A spokesman for the OSS said the original complaint from a solicitor writing from his home address was withdrawn in July.

'Nonetheless, the OSS felt that the issue warranted investigation regardless of whether there was still a complaint,' he said.

He added that the investigation would take 'months rather than weeks', adding that it showed the OSS was 'prepared to investigate alleged misconduct at even the biggest firms'.

A spokesman for Allen & Overy said it was contacted by the OSS some months ago.

'We were asked for, and we provided, information.

At no point were we provided with details or the nature of the complaint and we are told the Law Society is going to contact us shortly with further details of what the complaint is.'

Jeremy Fleming