Patisserie Valerie finance chief arrested after black hole found in accounts

Staff told not to talk about ongoing financial crisis as cafe chain faces closure after accounting irregularities uncovered, putting thousands of UK jobs at risk

Caitlin Morrison
Friday 12 October 2018 10:06
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Patisserie Valerie finance chief arrested after black hole found in accounts

Patisserie Valerie’s finance chief, Chris Marsh, has been arrested on suspicion of fraud, days after the company revealed a black hole in its accounts.

Mr Marsh was arrested on Thursday night and has been released on bail, the cafe group said in a statement to the London Stock Exchange.

Hertfordshire Police confirmed that a 44-year-old man from St Albans was arrested on suspicion of fraud by false representation.

In a statement, police said: “He has been released under investigation. We are not in a position to confirm names at this time. The investigation is being led by the Serious Fraud Office.”

The SFO confirmed that its director has opened a criminal investigation into “an individual”, but said it would give no further information or comment at this time.

The arrest comes days after Mr Marsh was suspended from the group after the bakery chain uncovered “significant, and potentially fraudulent, accounting irregularities”.

On Thursday, the group said that unless it could receive an “immediate injection of capital”, it would be forced to stop trading, putting 2,500 jobs at risk across the UK. The company is now urgently trying to find new funding.

Stores are still trading, although a branch in Hammersmith was shut on Friday after a landlord terminated its lease due to non-payment of rent.

Meanwhile, staff were told in an email on Friday morning not to talk about the situation, The Independent has learned.

The firm also revealed this week that HMRC had filed a winding up petition against its main trading subsidiary, Stonebeach, over an unpaid £1.14m tax bill.

Julie Palmer of accounting firm Begbies Traynor told the BBC on Friday that the winding-up petition had been issued last month, giving the group 21 days to deal with the issue.

“There is a whole sequence of events here where we’re talking about a listed company which until Wednesday was worth over £400m,” she said.

“It is actually quite staggering that the winding-up petition has happened without any notification to the stock market and I believe even the board said they weren’t even aware this had been served on the company.”

Patisserie Valerie declined to comment.

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