Further arrests and charges may follow in the Imperial Consolidated Group (ICG) scandal after the Serious Fraud Office charged five former directors of the finance company last week with conspiracy to defraud.
ICG, which went bust in 2002 owing up to £100m, ran investment schemes purporting to place most of the funds raised within its own consumer credit and commercial loans businesses. Many investors have lost all or much of their life savings in the schemes.
Those charged are former chief executives Lincoln Fraser and William Godley, former managing director Jared Brook, and two other executives: Nicholas Fraser and Robert Raven. The men were arrested at Lincoln Police station last Tuesday, held overnight and charged before appearing in court.
As conditions of bail, the men have to reside at their family addresses and report to a local police station. They have been required to surrender their passports and provide a surety of £100,000 each.
The first four defendants named above are being held on remand until their financial bail conditions have been met. All five have been bailed to appear at Lincoln Crown Court on 21 June.
But more former executives of related firms are expected to be charged later in the year.
The Independent on Sunday has closely monitored the many problems at ICG since January 2001. The group avoided the attention of UK regulators until it went bust in 2002.
ICG vigorously marketed opportunities to investors all over the world and claimed to place a large proportion of the funds in its own, UK-based consumer credit and commercial loans businesses. It evolved during the mid to late 1990s, using RAF buildings at Binbrook airfield, Lincolnshire, as its head office. It attracted private investment through a network of highly paid people who provided introductions, as well as through its own offices across a number of foreign jurisdictions. At its height in 2001, it employed 340 people in Binbrook alone.
ICG raised hundreds of millions of dollars to fund its activities through several offshore companies, including ones in the Bahamas, the British Virgin Islands and Grenada, where it had a bank and mutual funds.
The UK investment firms went into administration on 10 June 2002 as part of the worldwide collapse of the group. The administrators' report in March this year for one of its core UK companies estimated a shortfall of over £100m and a dividend payment to unsecured creditors of around 1p in the pound. This loss is additional to further sizeable losses made by other component parts of ICG.
Accounts show that Mr Fraser and Mr Brook were well paid, receiving £1,621,334 and £1,527,106 respectively for the seventeen-and-a-half months ended 30 September 2000, and £1,445,870 and £1,379,270 respectively, for the 12 months to 5 April 2001.
The defendants were directors of various ICG firms throughout its period of its operation.
The SFO investigation began in September 2002 in conjunction with the Lincolnshire Police Financial Investigation Unit.Reuse content