Revolution Beauty founder faces legal action over accounting scandal after auditor refused to sign off its books
Revolution Beauty is considering legal action against a former boss as it reels from an accounting scandal.
Trading in the make-up company’s shares has been suspended since September after auditors refused to sign off its books for the previous financial year.
Co-founder and chief executive Adam Minto quit the company with immediate effect in November after the launch of an investigation into the firm’s finances.
When the audited accounts were published last month, it revealed the company made £23million less than it had previously reported.
The cosmetics retailer has revealed it sent a letter to Minto last month alleging that he ‘breached his fiduciary, statutory, contractual and/or tortious duties to the company’.
Facing the music: Revolution founder Adam Minto (pictured with singer Alexandra Burke) quit the company in November after the launch of a probe into the firm’s finances
Revolution, which listed on the junior Aim market in 2021 with a market value of almost £500million, has said it was looking to ‘recover material sums relating to the exceptional costs the company incurred as a result of the matters alleged’.
The firm has set Minto a deadline of July 7 to respond. It says he has not done so yet.
In a further blow, major shareholder Boohoo has also called for chief executive Bob Holt, chairman Derek Zissman and chief financial officer Elizabeth Lake to be booted out of the firm.
A spokesman for Boohoo said: ‘As Revolution Beauty’s biggest shareholder, Boohoo is grateful to Bob, Derek and Elizabeth for stabilising the business.
‘However, as Revolution Beauty transitions to its next phase, where the focus must switch to growth, Boohoo believes a senior leadership team with the right retail, e-commerce and consumer brands experience is required to deliver shareholder value.’
Boohoo said it would vote against the reappointment of these directors at Revolution’s annual meeting next week.
