Fines and bans for former Cattles directors

THREE former Cattles directors have been fined £700,000 and banned from financial services.

James Corr, Cattles’ finance director and Peter Miller, finance director at subsidiary Welcome Financial Services, have been fined £400,000 and £200,000 respectively for misleading investors.

Welcome’s managing director John Blake faces a £100,000 fine from the Financial Services Authority although he has referred his case to a tribunal.

Cattle was a FTSE 250 company specialising in sub-prime lending but got into difficulties when accounting irregularities were uncovered.

Shareholders subsequently received 1p for each share in Cattles that were originally issued for £1.28.

Tracey McDermott, the FSA’s acting director of enforcement and financial crime, said: “The consequences for shareholders of the misleading statements issued by Cattles and Welcome have been devastating. These directors failed to act with integrity in discharging their responsibilities. They failed in their obligations to shareholders, the wider market and the regulator.

“In order for markets to function properly, information given to investors must be accurate.  Directors of listed companies must act with integrity and exercise appropriate diligence when making disclosures to the market. They should note the personal consequences for those who fail to meet our requirements.”

All three directors have been banned from any role in activities regulated by the Financial Services Authority.

The FSA said Batley-based Cattles has included “highly misleading figures” in its 2007 annual report suggesting only £0.9bn of its loan book was in arrears when the reality was closer to £3bn.

These figures were later included in the prospectus presented to potential investors in April 2008 for a rights issue which went on to raise £200m.

Cattles left the stockmarket last year after its shares were bought by Bovess.