Ve Interactive’s former CEO is being investigated for alleged fraud after the company, previously valued at £1.5bn, was bought for just £2m last month, rescuing it from going into administration.
David Brown, who co-founded the AdTech business in 2009, is being investigated over allegations that he spent some £11.5m of Ve’s money to support other ventures and interests owned by him, his ex-wife and his girlfriend.
According to The Sunday Times, Brown is also under investigation following allegations that he was renting a series of luxury flats in London as well as a £200,000 customised Range Rover.
Edwin & Coe, the law firm charged with investigating whether the directors used Ve’s money to fund their own lifestyles, is also examining expenses claims, which included a total of £45,653 being spent on wine.
Additionally, the law firm is also investigating whether Brown and other people benefited from the sale of secondary shares worth up to £50m prior to Ve’s documented fall from grace.
Based in Spain, Brown denies the claims. He said all allegations were “cheap jibes and misinformation”, adding that Ve’s new ownership had “one strategy in hand, which is to detract from their actions”.
Brown then went on to add that he had always acted with “full integrity” and noted there was “significant legal action under way”.
A source told Tech City News that Ve was looking to distance itself from what had happened in the past and move forward as a business under the new management.
Difficult times
The news comes after Brown stepped down as CEO in March amid reports that the company had been unable to pay staff on time and its valuation was slashed from £1.5bn to just £300m.
Following that, in April, Ve interactive went into administration before it was rescued by its new management team led by CEO Morten Tonnesen and managing director David Marrinan-Hayes.
At the time of the announcement, a company spokesperson said the buyout would allow the group to “safeguard hundreds of jobs”.