Police yesterday arrested millionaire businessman Paul Careless in connection with the collapse of mini-bond investment firm London Capital & Finance (LCF).
He is the fifth person arrested as part of a Serious Fraud Office (SFO) investigation into LCF’s failure.
An SFO spokesperson said: “On 19 June 2019, 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.”
LCF went into administration in January owing £236m to more than 11,000 investors.
Its collapse is being investigated by the Financial Conduct Authority and the SFO, which has made five arrests.
Careless is the chief executive of Brighton-based online marketing company Surge Financial, which found clients for LCF.
LCF’s scheme was marketed as a “Fixed Rate ISA” to customers, many of them first time investors.
LCF paid Surge 25 per cent commission for running the marketing campaign, which amounted to £60m.
A spokesperson for Surge said: “Paul Careless has not been charged and he is not on bail.
“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.”
The Evening Standard first reported Careless’s arrest.