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Last Updated: Feb 18th, 2008 - 14:39:01 |
(Independent News and Media) - Shareholders of Langbar International expressed anger and dismay yesterday at news that Stuart Pearson, the former chief executive of the "cash shell", would earn fees of up to £30,000 a year by staying on as a consultant to the scandal-ridden company.
The revelation came at an investor meeting called by the insolvency specialist David Buchler, who took the helm at the company just before Christmas. Shareholders said they felt misled by Mr Pearson. They pointed out that the former Baker Tilly corporate financier, who was not present at the meeting, had in numerous statements to the Stock Exchange assured investors that the company had cash reserves of £365m. This subsequently proved not to be the case.
Masood Quraishi, a private shareholder, said: "Stuart Pearson's consultancy fee is an insult to us. Most shareholders here bought into Langbar on the basis of his statements which turned out to be totally wrong."
Another small shareholder said: "Mr Pearson should continue to help Langbar for free. It is the least be can do."
Mr Buchler told the gathered investors that their company probably never had £365m in cash. He said: "I don't believe there was ever any money at Langbar." In his opinion, the fraud at the company remained undetected by its auditors and advisers because of forged bank statements and cash transfer documents. For a long time, investors were led to believe Langbar had a third of a billion pounds on deposit in accounts in Brazil and the Netherlands.
However, Mr Buchler stressed that his investigation was still at a very preliminary stage and said it was far too early to start to point the finger at any party being to blame for the fraud.
In terms of the amount likely to be recovered in compensation for shareholders, the new company chairman said a figure of up to £100m was a possibility but suggested that it could end up being "quite a bit less". Langbar shares were suspended in October at 50p, which valued the whole company at £86m. They will be delisted from AIM on 12 April.
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