Patisserie Valerie's Suspended Finance Director Is Arrested

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While chain with two local branches needs 'immediate cash injection' to continue trading

The Patisserie Valerie chain, which has a cafe in Shepherds Bush and Hammersmith is today on the brink of collapse following the discovery of a massive potential fraud.

In the latest twist to an astonishing story, the company's suspended finance chief Chris Marsh was arrested by police overnight just days after the company revealed the potential fraud.

Earlier this week the company admitted it had uncovered "significant, and potentially fraudulent, accounting irregularities."

These irregularities amount to a black hole in the company's finances which is reported to be as much as £2 million.

In a statement made yesterday, Thursday 11 October, Patisserie Valerie that over the past 24 hours it had "undertaken further investigation into the financial status of the company".

The board found "a material shortfall between the reported financial status and the current financial status of the business".

"Without an immediate injection of capital, the directors are of the view that that is no scope for the business to continue trading in its current form," it continued.

The company said its "professional advisers are assessing all options available to the business to keep it trading and will update the market in due course".

Last night, Hertfordshire Police confirmed the arrest, saying: " A 44 year old man from St Albans has been arrested on suspicion of fraud by false representation. He has been released under investigation."

Patisserie Valerie said today: " The company has been made aware that Chris Marsh, who is currently suspended from his role as company finance director, was arrested by the police last night and has been released on bail. Further updates will be released in due course as appropriate".

After suspending its finance director, the firm asked for its shares be suspended from trading on the London Stock Exchange’s junior AIM market while it carried out a full investigation into its true financial position.

The company also warned its investors it faced a winding up petition from HMRC over £1.14m in unpaid tax.

HMRC said that Patisserie Holding’s principal trading subsidiary, Stonebeach, owes it £1.14 million, and has set a hearing date of 31 October to seek a court order to liquidate the firm and its assets.

The company said it and its advisors were in communication with HMRC with the objective of addressing the petition.

Chairman Luke Johnson said earlier this week: " "We are all deeply concerned about this news and the potential impact on the business. We are determined to understand the full details of what has happened and will communicate these to investors and stakeholders as soon as possible."

The first Patisserie Valerie café was opened on Soho's Frith Street in 1926 by Belgian-born Madame Valerie. It was destroyed in World War II and a new site opened at nearby Old Compton Street.

Now it has 206 cafes across the country, employing around 2,000 staff.

 

October 12, 2018