Maloney to investigate Worldspreads collapse

ACCOUNTANT GEORGE Maloney is to investigate the collapse of spread trading group Worldspreads, after being appointed liquidator to two of its key companies yesterday.
Worldspreads collapsed dramatically in March when its board discovered a €15.6 million-plus shortfall in client funds.
A creditors’ meeting in Dublin yesterday appointed insolvency specialist George Maloney, of Baker Tilly Ryan Glennon, to Worldspreads Group plc and Worldspreads International Ltd.
Following the meeting, Mr Maloney confirmed he will be carrying out an investigation into the circumstances surrounding the demise of both companies. His appointment means that the spread trading group’s collapse is now the subject of two investigations in two different jurisdictions.
Shortly after the collapse in March, the UK authorities appointed Jane Moriarty and Samantha Bewick of KPMG as special administrators to Worldspreads Ltd, which was based in London and played a central role in the group’s operations.
Part of their brief is to investigate the directors’ conduct and the circumstances surrounding the collapse of the business.
Mr Maloney said yesterday that he would be communicating with the special administrators shortly.
The two investigations are likely to feed into each other as it is understood that there were substantial transactions between various companies in the group.
Worldspreads chairman Lindsay McNeile attended yesterday’s meeting. He said afterwards that, on legal advice and to avoid any risk of prejudice to any investigations, he declined to answer any substantive questions. He made no comment following the meeting.
Former chief executive Conor Foley also attended. He did not issue a statement afterwards.
The board discovered the £13 million shortfall in Worldspreads Ltd in mid-March. The company owed clients £29.7 million, but had just £16.6 million to pay them.
The shortfall emerged as the board was preparing the ground for incoming interim chief executive Roger Hynes.
Mr Foley had resigned as chief executive days earlier to pursue other interests. Finance director Niall O’Kelly left the group in February.
Mr Foley had an 18 per cent stake in the group. In March, both he and the board said that his resignation had nothing to do with the crisis that unfolded following his departure.
He and Mr O’Kelly helped found the business in Dublin in 2000. It floated on the Irish and London stock exchanges seven years later. It spun off its Irish business and moved operations to London to focus on expanding in the British and European markets.