Quindell shares plunge by as much as 40pc

The Serious Fraud Office (SFO) has opened a criminal investigation into business and accounting practices at Hampshire-based Quindell. Quindell said the SFO had informed it has opened an investigation into the company’s past business and accounting practices.

Trading in the stock on London’s Aim market was suspended in June, after the FCA said it was probing statements made about Quindell accounts.

On Wednesday, Quindell re-published its 2014 annual report after making “substantial restatements of prior year revenues, profits and net assets”, according to the Financial Reporting Council, the United Kingdom accounting regulator. In 2013, Quindell reported a profit of £107 million, but yesterday’s recalculations revealed that the company was in fact £64 million in the red, while last year’s recorded £96 million loss was reassessed as a loss of £282 million.

Those findings prompted the company to restate its 2013 numbers yesterday and apply the same more conservative accounting to its 2014 results.

Quindell, which grew through a spate of legal provider acquisitions, brought in PwC in December 2014 to carry out an independent review, evaluating the group’s main accounting policies and cash generation expectations for 2015. It forecast revenue to remain largely flat in 2015, compared with 72 million pounds for 2014.

The PSD, mostly handling personal injury but also includes marketing and motor services, employs around 1,400 staff, and operates under a range of brands including Silverbeck Rymer, Pinto Potts and The Compensation Lawyers, while the complementary services has around 1,000 staff members. Its 2013 and 2014 publicly released financial statements are already being investigated by Britain’s financial regulator, the Financial Conduct Authority.

Quindell also said on Wednesday it expected to appoint a new chief executive and begin a review of the business. ‘A variety of factors led the business to become destabilised.

Slater & Gordon declined to comment.

Quindell (Xetra: M6FA.DE – news) shares plunged as much as 40pc after investors took fright at a host of investigations into the company and revelations its results had been overstated.

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