Financier in fraud trial questioned over bankruptcy

TERRY RAMSDEN, the archetypal City hotshot of the 1980s, has been arrested by police on behalf of the Serious Fraud Office, it was confirmed yesterday.

Ramsden walked free from the Old Bailey two weeks ago after admitting a pounds 90m fraud. He was given a two-year suspended jail sentence after pleading guilty to four charges of fraud. The failure of the prosecution to secure a custodial sentence caused uproar and was followed by calls for the winding up of the SFO, which has lost a string of recent high-profile fraud cases.

City of London police said that Ramsden had been detained on Friday in connection with alleged offences associated with his bankruptcy. He has been released on police bail.

Ramsden, son of an Essex postman, became one of Britain's wealthiest men after building one of the most successful City dealing operations of the 1980s.

In court he admitted that he had fraudulently induced finance houses on four occasions to invest in his company, Glen International, knowing that he would be unable to repay them. The money was used to buy high-risk, but potentially very profitable, Japanese warrants which entitle the holder to buy a block of company stock at a set price within a set time. Ramsden apparently believed that the value of the shares would rise. Many did not.

It was, however, accepted by the SFO that he did so out of criminal financial recklessness than out of dishonesty. After the collapse of his company, he went to America but returned voluntarily to stand trial in Britain. He had earlier been bankrupted for pounds 25m.

Ramsden became a millionaire by the time he was 21, and turned Glen International from a company with an annual turnover of pounds 18,000 to a major international dealing house doing business worth pounds 3.5bn. He became a symbol of success in the City, an archetypal Essex Man, who relished his cockney accent and his shoulder-length hair.

He enjoyed a extravagant lifestyle. He owned a pounds 1.3m Georgian mansion in Blackheath, south-east London which has now been repossessed, drove a Ferrari and owned a jet. He had houses in several countries. But his chief passion, after the stock market, was racehorses. He owned one of the country's biggest stables, with 75 horses, and claimed to have won pounds 1m when one of his horses won the Coronation Stakes at Royal Ascot in 1984.

It has since, however, emerged that he went on to lose pounds 57m in just three years - including several million squandered on gambling. He was also a keen football fan and bought Walsall FC for pounds 400,000.