Stuart Pearson convicted and sentenced | AccountingWEB

Stuart Pearson convicted and sentenced

A chartered accountant formerly a partner in Baker Tilly, Mr Geoffrey Stuart Pearson (known as Stuart Pearson), has been sentenced to 12 months imprisonment following his role in the Langbar International fiasco.  Confiscation proceedings are to follow.

Langbar was a company listed on the AIM which at one time was said to have assets of over £350 million, mostly represented by cash deposits in overseas banks - but the existence of those deposits could not subsequently be verified.  Mr Pearson was Chief Executive Officer of the company.  He has been convicted of making statements (public statements to the market and private statements to a hedge fund manager) which he knew to be misleading, false or deceptive or of being reckless in making them.


stepurhan's picture

Never knew you had such power

stepurhan | | Permalink

My e-mail alert for this read "Stuart Pearson convicted and sentenced by davidwinch". I thought you just did expert witnessing, not convicting and sentencing. :-)

I presume there is a reason why, concerning the foreign deposits, you say their existence "could not subsequently be verified" rather than just that they did not exist. Does the case leave it as a possibility that they do exist? If so, I'm guessing it would have a significant effect on the conviction if they were located.

davidwinch's picture

Not verified

davidwinch | | Permalink

The press reports at the time said that the deposits could not be verified.  I am copying that (with a view to libel law and so on) but I imagine if the cash could have been produced then the prosecution would not have gone ahead.

Mr Pearson was not convicted of any misconduct connected directly to the cash - rather he was convicted of making misleading statements about the company's financial affairs.

Interestingly although he was convicted of 3 counts he had been charged with further counts (of which he was acquitted).

There will be confiscation proceedings but it seems to me that he does not have a 'criminal lifestyle'.  So the question will be 'what benefit did he obtain from the offences of which he has been convicted?'.

It may be the case, I don't know, that he had shares in the AIM listed company of which he was CEO.  It may be that those shares increased in value after the misleading statements were issued, but then lost value as the company failed.

If so would the temporary increase in value be a 'benefit' obtained from the offences (even if only a 'paper' profit)?


Could be interesting!


New research from KPMG has

Donald Harper | | Permalink

New research from KPMG has revealed that fifty per cent of corporate fraud in the UK is committed by senior management and those with Board roles, reports the Banking Times.

The research also highlighted the fact that management review led to the detection of only 22% of UK frauds covered in the survey, with whistleblower reports and anonymous tip-offs accounting for a further 34%.

KPMG suggests that “red flag” warnings, such as employees who rarely take holidays or who lead an excessive lifestyle, are frequently missed by firms, particularly since the onset of the credit crisis.

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