London’s Daily Telegraph’s article on the collapse of Axiom Ince have reported on the acquisition of property and property developments with the firm’s co-founder Pragnesh Modhwadia involved in multiple businesses, several of which have entered receivership or insolvency.
Axiom Ince faced a catastrophic collapse amid accusations of a £66 million fraud. The dramatic situation involved both lawyers and clients, with the Serious Fraud Office (SFO) conducting nine raids and arresting seven individuals.
Modhwadia, was at the center of the controversy, known for extravagant celebrations, including a lavish merger party at the London Reign nightclub.
Described in the Daily Telegraph article as well dressed, bubbly and confident, he was reportedly someone who could instil confidence in people and build his law firm and excite the firm employees over ambitious plans for growth.
At a three-course management dinner in Mayfair following the acquisition, Modhwadia shared hopes of becoming a law firm with £250m of revenue within the year.
Despite the initial success following the merger of Axiom and Ince Gordon Dadds, the firm encountered severe legal issues. Modhwadia and two other directors were suspended by the Solicitors Regulation Authority (SRA) due to suspected dishonesty. This led to the discovery of missing client funds and the subsequent freezing of £64 million in assets.
After the SFO launched its investigation, the SRA said it suspected Modhwadia, Axiom Ince’s sole shareholder, of “misusing significant amounts of client money” in what appeared to be a “sophisticated” fraud that “included falsified bank statements and letters.”
Former employees and industry insiders expressed shock at the rapid unraveling of the firm, which had recently saved Ince in a £2.2 million deal. Axiom’s acquisition raised eyebrows due to its contrast with Ince’s longstanding reputation in maritime law. Concerns about the cultural fit and the sustainability of the merger were prevalent among Ince’s staff.
The SRA’s intervention led to the closure of Axiom Ince, leaving many employees jobless and raising questions about the regulatory body’s timing and effectiveness in detecting the fraud.
When it announced its investigation, director Nick Ephgrave said: “There are a number of significant questions that need to be answered: clients from this law firm are missing many millions of pounds and more than 1,400 of its staff have lost their jobs. The impact on those affected is extremely serious.”
