David Ross, the co-founder of UK mobile phone retailer Carphone Warehouse, has resigned as deputy chairman after failing to declare he had pledged shares he owned in the company against personal loans.
Mr Ross, ranked 87th in the
Sunday Times2008 Rich List with an estimated fortune of £873 million ($1.3 billion), is one of Britain's best-known businessmen and was chosen by London Mayor Boris Johnson in May to help organise the 2012 Olympics.
He also failed to disclose similar arrangements for his shares in bus and rail firm National Express, of which he is chairman, and two other companies of which he is a director, regulatory filings showed today.
Shares in Carphone, which Mr Ross jointly founded with Charles Dunstone in 1989, fell over 5 per cent to a 5-1/2 year low of 87 pence on concerns Mr Ross might have to sell his 19 per cent stake in the business.
UK listing rules require that directors should disclose immediately if they have pledged shares against personal loans. Carphone said Mr Ross had struck his loan agreements between 2006 and 2008.
"The company hadn't been aware of this until this time," Mr Dunstone told analysts on a conference call. "As a result of that, David has tendered his resignation to the board."
Mr Ross could not immediately be reached for comment.
Britain Financial Services Authority declined to comment on whether it would be taking any action. The London mayor's office and London Organising Committee of the Olympic Games (LOCOG) had no immediate comment.
Carphone said Mr Ross had pledged 136.4 million shares against personal loans between 2006 and 2008. This was on top of around 41 million shares pledged against loans which he had previously disclosed.
It said Mr Ross had notified the company that none of the loans were in default and that he had no current intention of selling his shares.
Reuters