Globo woes mount as FCA called in to probe trading

THE crisis at Globo deepened yesterday after the financial watchdog launched an investigation into the mobile software firm over claims it falsified sales.

The chief executive and finance director of the firm resigned last weekend amid allegations of financial irregularities and Globo now faces a probe by the Financial Conduct Authority.

The AIM-listed firm was forced to suspend its shares on Friday after global equity fund and short-seller Quintessential Capital Management claimed Globo was ‘massively overstating’ its revenue and profit. Globo founder and chief executive, Costis Papadimitrakopoulos, denied the allegations.

But at an emergency board meeting the next day he admitted accounts were falsified and resigned, along with finance director Dimitris Gryparis.

On Monday it emerged Papadimitrakopoulos sold more than 40m shares, worth more than £12m, shortly before QCM’s report was published.

Canaccord Genuity, the firm’s joint corporate broker, resigned and Globo’s chief operating officer was suspended. Globo has reported the matter to law enforcement agencies in the UK, Greece and Cyprus and its shares are suspended at 28.25p.

The firm has now set up an independent board committee and called in external auditors.

Last night Simon Cawkwell, the short seller nicknamed Evil Kneivel, said: ‘There are many breaches of law alleged here that have arisen in and around Globo. There’s the fraudulent raising of money; the deliberate misleading of markets; and the accounts, which appear to have been signed off even though they are a hunk of junk.’

Papadimitrakopoulos is thought to have fled Greece.

Globo is valued at about £106m.