David Ross, Carphone Warehouse co-founder and deputy chairman, has resigned from the retailer. The shock announcement comes after it was revealed Ross (pictured) had used 136 million of his shares as security against personal loans without informing the company.
He claims that he had no intention of selling the shares and none of the loans were in default, but Stock Exchange rules state that an announcement must be made if a director pledges shares as collateral. Ross failed to inform Carphone Warehouse that he has used his shares until December 7.
Charles Dunstone, co-founder and chief executive of the company, says the incident was likely to have been an oversight and misunderstanding of what Ross was required to do.
Ross has a total of 177 million shares in the company and with Dunstone holds a 52% stake in the business.
The news comes just weeks after Dunstone announced that Carphone Warehouse was considering plans to spin off its broadband business Talk Talk. It is not clear when the move will go ahead.
In August, Carphone Warehouse’s retail business was part-acquired by US electronics company BestBuy.