E Point Perfect

Patisserie Valerie ex-chair expects huge payday as auditor settles £200m lawsuit


Patisserie Valerie
// Patisserie Valerie former chair in line for large payday after Grant Thornton settles £200m court case
// Grant Thornton was sued by liquidators after Patisserie Valerie imploded in 2019

Patisserie Valerie former chairman Luke Johnson is expected to receive a large payout after auditor Grant Thornton settled a £200 million court case over the chain’s collapse.

Johnson is thought to be one of the top creditors to benefit from a multi million-pound settlement of the case that was brought against Patisserie Valerie’s auditors.

The payout represents most of Grant Thornton’s annual claims provision of £28 million, which was contained within the auditor’s most recent accounts.

READ MORE: Patisserie Valerie auditor fined £2.3m for “lack of competence” ahead of collapse

Grant Thornton was sued by liquidators after Patisserie Valerie imploded in 2019 as “a direct result of a significant fraud”.

Patisserie Valerie had removed the butter from its puff pastry in an attempt to save money, The Telegraph reported.

Johnson said he was tricked by other executive directors, who gave a fake picture of the company’s finances.

Shareholders previously considered bringing legal action against the board of directors, including Johnson.

Patisserie Valerie’s liquidators FRP Advisory hired lawyers at Mishcon de Reya last year to sue Grant Thornton for damages of around £200 million. The accountancy firm audited the company for 12 years and failed to spot any alleged manipulation.

At the time, Grant Thornton said that it would “rigorously defend the claim”, adding: “Patisserie Valerie is a case that involves sustained and collusive fraud, including widespread deception of the auditors. The claim ignores the board’s and management’s own failings.”

In September last year Grant Thornton was fined £2.3 million by the Financial Reporting Council for failures in audits between 2015 and 2017.

A criminal investigation into the business and accounting practices of individuals associated with parent company Patisserie Holdings is still being conducted by the Serious Fraud Office.

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