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Boohoo Share Price Slips 5% on links to money laundering garment network

Practice Stock Trading
Updated: 13 October 2020

Shares of Boohoo (LON: BOO) slipped around 5% on Tuesday after the company and Selection Fashion were both linked to Leicester-based group firms that are involved with money laundering and VAT fraud.

According to BBC Radio 4, a director of one company in Leicester, Rostum Nagra, was accused of stealing a firm belonging to a business associate. He then, allegedly, transferred all assets to his own company Rocco Fashion Ltd.

According to the judge in this civil case, Nagra created a “fraudulent scheme to launder cash for his own benefit”. This occurred over a “prolonged period” with “very substantial amounts” of money.

Boohoo confirmed it cooperated with T&S, one of the companies mentioned in this case. According to Boohoo, they have selected an auditing firm to map out its supply chain.

“This work is well under way and once it is completed we will be publishing a list of all of our UK suppliers,” Boohoo said in a statement to the BBC. 

Boohoo share price fell on Tuesday after being linked to “extraordinary” money laundering garment network

Boohoo share price fell nearly 6% before erasing more than half of these losses to trade at 340p, or 2.02% on the day.