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Four people have been charged in connection with the collapse of Patisserie Valerie – a bakery chain that once had almost 200 stores.
The Serious Fraud Office (SFO) said it related to an investigation that began in October 2018 – just two days after the company abruptly suspended trading, with more than 900 jobs and 70 sites subsequently lost.
Christopher Marsh, who formerly served as Patisserie Holdings’ chief financial officer, is among those facing charges.
His accountant wife Louise – as well as financial controller Pritesh Mistry and financial consultant Nileshkumar Lad – have also been charged.
“The SFO has charged all four suspects with conspiring to inflate the cash in Patisserie Holdings’ balance sheets and annual reports from 2015 to 2018, including by providing false documentation to the company’s auditors,” a statement said.
“During this time, the company also reported holding £28m in accounts, yet concealed £10m in debts from its investors and creditors.”
The four individuals are due to appear before Westminster Magistrates Court next month for the charges to be formally read.
Lisa Osofsky, director of the SFO, added: “Patisserie Valerie’s abrupt collapse rocked our high streets – leaving boarded-up shops, devastating job losses and significant investor losses in its wake.
“Today is a step forward in getting to the bottom of this scandal.”
The criminal case has run separate to wider investigations into failures associated with the company’s demise.
Accountancy firm Grant Thornton was fined £2.34m in 2021 by the industry’s watchdog.
The Financial Reporting Council’s conduct inquiry found “serious lack of competence” in its audits of the cake chain, declaring that “red flags” were missed.
Speaking about the charges, Richard Cannon, Partner at Stokoe Partnership Solicitors, commented: “The SFO case against former Patisserie Valerie executives will no doubt be touted by the organisation as a success, having dropped two high-profile cases into ENRC and Rio Tinto in recent weeks.
“Despite this, questions must be asked as to why it has taken the SFO five years to bring charges against these individuals, and whether the service is fit for purpose.
“As the SFO looks to new leadership under Nick Ephgrave, it is vital that the organisation address these concerns if it is to accomplish the Herculean task of trying to restore its credibility as a regulator.”