FRAUD INVESTIGATION INTO COLLAPSE OF FLYGLOBESPAN DROPPED

Dino D'Amore
By Dino D'Amore February 23, 2011 09:47

FRAUD INVESTIGATION INTO COLLAPSE OF FLYGLOBESPAN DROPPED

The Serious Fraud Office (SFO) has announced its has dropped an eight-month investigation into credit card processing company E-Clear, widely blamed for the collapse of Scottish airline Flyglobespan.

The SFO said there was “insufficient evidence” to pursue a prosecution against E-Clear. The company went into administration in January last year owing an estimated £127 million. A few weeks later Flyglobespan and parent company Globespan collapsed, leaving thousands of holidaymakers stranded abroad. Globespan’s receivers, PricewaterhouseCoopers (PwC), linked the airline’s collapse with the behaviour of E-Clear. The London company had withheld some £25m worth of Flyglobespan’s fares while negotiating to buy the airline.

Receivers for E-Clear later discovered debts of some £127m and linked its business with the collapse of several other airlines, including the Scottish-owned Canadian operator Zoom.

Although the SFO has closed its investigation, the Insolvency Service is continuing with its probe into E-Clear and its director.

Dino D'Amore
By Dino D'Amore February 23, 2011 09:47
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