MGI Worldwide accountancy network chairman Roger Isaacs interviewed by BBC Radio 4's Money Box

Roger Isaacs, MGI Worldwide's chairman recently spoke to BBC Radio 4's Money Box about preventing bank payee fraud, highlighting the case of London Capital and Finance.

MGI Worldwide accounting association is home to a range of experts on a wide variety of financial topics, so it is no surprise to see Roger Isaacs - our chairman and forensic partner at MGI UK & Ireland firm Milsted Langdon LLP - speaking to BBC Radio 4's Money Box programme.

The subject on hand was fraud, specifically that which may have been committed by London Capital and Finance, a firm that has gone into administration since the programme was aired.

What happened in the case?

Investors were promised interest rates of eight per cent on their ISAs, on the basis that the money would be loaned out to hundreds of companies to mitigate risk. However, the funds were instead given out to just 12 companies, who have been found to have behaved unusually by putting off filing their accounts; or in some cases, not filing at all.

"It's not unusual for companies to delay their filing deadlines or to extend their accounting periods," said Mr Isaacs, "but what's unusual about this case is that you've got a number of companies, all of whom appear to have borrowed money from London Capital and Finance, and what’s unusual is they've all used the same approach."

The companies also changed their names repeatedly, which Mr Isaacs said raised alarm bells. Although there's nothing illegal or unusual about a company changing its name, he commented: "One questions why constant name changes are necessary?"

Unusual practices and no guarantee of returns

Overall, it was his expert opinion that something unusual was going on based on the information he had seen at Companies House. He added: "The thing that caused alarm bells to ring most was the lack of transparency, and a number of indications that could suggest there's been a deliberate attempt to avoid transparency by failing, for example, to file accounts, by constantly changing names."

Unfortunately for those who were taken in by London Capital and Finance, Mr Isaacs wasn't hopeful they will see a return on their investment. "I wish I could offer them some comfort, but on the basis of what I've seen so far, it looks as if the prospect of them getting a recovery is far from certain," he said.

For further information visit Milsted Langdon LLP's profile page HERE or their website HERE

MGI Worldwide is a top 20 ranked international accounting network with some 5,200 independent auditors, accountants and tax experts in over 260 locations around the world.