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Braemar Inquiry Expands to "Small Number" of Transactions in 2006-13

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Ship models at Braemar's London offices (Braemar file image)

Published Sep 24, 2023 7:33 PM by The Maritime Executive

London shipbroker Braemar has broadened its investigation into a series of transactions from years past, and it expects to report the findings sometime next month. 

In June, just ahead of the filing deadline for its FY2023 annual report, Braemar's board announced an accounting investigation into one $3.7 million transaction dating back to 2013-17. In a statement, the board said only that it was "not presently comfortable" with the accounting treatment for the liabilities resulting from this transaction. Under the circumstances, the company could not meet the July 1 deadline for filing its annual report, and it asked for a temporary trading suspension. 

Braemar's non-executive chair is overseeing the investigation, with assistance from forensic accounting consultancy FRP Advisory.

In an update Friday, Braemar confirmed that it continues to make progress on the internal inquiry. The scope has now widened to include a "small number" of transactions in a time period stretching back to 2006-13. 

The investigation has been complex, the firm said, but is nearing completion. The details will be presented next month after Braemar's long-awaited FY2023 results are released, "as far as the board is able."

For shareholders, the news is generally positive: FY2023 was likely the firm's most profitable year ever, and underlying profits are expected to come in at about $25 million. The first half of FY2024 has also been unusually strong, despite a downturn in container shipping. 

"We continue to deliver on our strategy, and I am delighted with the performance of the business and the strong start to this year. I am also pleased that the investigation, which has been time consuming and complex, is now coming to an end and the business has shown considerable resilience throughout this period," said CEO James Gundy in a statement. 

Last week, Braemar's global head of sale & purchase departed for undisclosed reasons, according to industry media. Sebastian Davenport-Thomas, 51, had been a registered director with the firm since 2010, UK corporate records show. As of Sunday, Davenport-Thomas' name and contact information have been removed from the firm's online list of department directors.