DTI target had previous failure

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CARL CUSHNIE, whose trade finance group, Versailles, is subject to a Department of Trade & Industry probe into accounting irregularities, ran a computer group that went into liquidation seven years ago, writes Jason Nisse.

The Jamaica-born businessman has been attacked for not informing the DTI investigation when he sold pounds 29m worth of shares last month.

The share placing came only a month before the suspension of Versailles shares at 250p last week. They had risen from just 8p when floated in 1995. The Serious Fraud Office is taking an interest in Versailles but has not launched an investigation.

Mr Cushnie launched Versailles after the collapse of his previous business venture, Pentagon Business Systems. The computer reseller was placed in liquidation in 1992, leaving creditors owed thousands of pounds. The liquidators were Levy Gee, an accountancy firm Mr Cushnie used to conduct his own review of Versailles accounting practices.

This review was superseded by a second probe from accountants Baker Tilly, which uncovered irregularities.

Mr Cushnie was not available for comment yesterday, but it is understood that he blamed the collapse of Pentagon on the problems of obtaining finance. A spokesman said that the Pentagon troubles led him to launch Versailles to help companies that could not obtain finance from conventional banking sources.

Levy Gee was also not prepared to comment on the Pentagon affair, claiming that it was too far back in the past.

Mr Cushnie has admitted failing to mention inquiries by the DTI and Customs & Excise to the company's financial adviser Teather & Greenwood during the sale of his shares.