Tory MP’s firm sold after £237m savings scandal
a BUsInEssMan who sold toxic bonds on behalf of collapsed savings firm London Capital & Finance has cut his ties with high-flying Tory MP Johnny Mercer.
Paul Careless has sold The Crucial Group – which pays Mercer £85,000 a year to work for 20 hours a month as a nonexecutive director – after its links to the LCF scandal were exposed by the Mail.
The Crucial Group trains military veterans in cyber security and hired Mercer, a former army officer, in september.
But other companies owned by Careless promoted bonds sold by LCF, which has since gone bust and is being probed by fraud investigators.
Mercer, 37, has always insisted there is no link between LCF savers’ money and Crucial.
But insiders said Careless has sold the firm to management because his involvement was damaging its work.
a source close to 43-year-old Careless said yesterday: ‘Paul decided to sell because he felt he was becoming a distraction to the company.
‘He did not want to get in the way of the great work being done at Crucial, and wishes the firm well for the future.’
Crucial will now be fully owned instead by its chief executive, former Royal Marine neil Williams, with paperwork being finalised this weekend.
Careless owns a string of other companies as well as Crucial.
They include surge Financial and RP Digital services which helped drive savers to LCF by claiming it provided ‘ fully secured’ bonds with returns as high as 8pc through an online advertising blitz. These companies typically took as much as 25pc of each saver’s cash in fees for this work, earning them £58m in fees.
But LCF went bust this year owing £237m to 11,500 savers.
savers thought that LCF was investing their money in a wide range of promising start-up companies.
But instead, it went to just 12 businesses, most of which were connected to LCF’s founder simon Hume-Kendall and his associates.
Money found its way to a riding stables and a holiday development in the Cape Verde islands in transactions which administrators have called ‘deeply suspicious’.
The serious Fraud Office has made four arrests.
Careless’s companies were not involved in any investment decisions, and he has not been arrested. a spokesman for Careless declined to comment.