Wednesday 21 August 2019

Millionaire marketing boss arrested in bond fraud probe

Paul Careless, owner of Surge Financial which marketed London Capital & Finance’s bonds, is the fifth person arrested in the SFO investigation.

Paul Careless was released (Dominic Lipinski/PA)
Paul Careless was released (Dominic Lipinski/PA)

By Henry Saker-Clark, Press Association City Reporter

The millionaire boss of a marketing firm at the centre of a £236 million savings scandal has been arrested.

Paul Careless, the owner of Surge Financial, was arrested and questioned by the Serious Fraud Office (SFO) near Brighton on Wednesday.

He was released and has not been charged and is not on bail.

Mr Careless is the fifth man to have been arrested after the SFO launched a criminal investigation into the collapse of London Capital & Finance earlier this year.

The four men previously arrested included LCF chief executive Andy Thomson, and the chairman of its biggest borrower, Simon Hume Kendall. All four were bailed without charge.

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Paul Careless, founder of Surge Capital, was arrested as part of the SFO investigation into London Capital and Finance (Surge / PA)

London Capital & Finance went into administration at the end of January after netting £236 million by advertising tax-free individual savings accounts.

However, it was in fact a high-risk bond scheme with an interest rate of 8% and left more than 11,000 mainly elderly investors facing hefty losses.

Mr Careless’s company Surge Financial took 25% commission for marketing bonds by LCF.

A spokesman for Surge said: “Surge was a third-party supplier of services used in relation to raising investment for LCF.

“It did not handle client money and had no involvement in the deployment of funds to borrowing companies.”

Last month, the Government launched an independent inquiry into the collapse of LCF, led by leading high court judge Dame Elizabeth Gloster.

An SFO spokesman said: “On June 19, search warrants were executed at several properties in the Home Counties.

“One individual was arrested and released pending further investigation.

“The operation was conducted with the assistance of the National Crime Agency.”

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