Shocking Revealed: Uncovering the Dark, Violent History of the Mastermind Behind Victoria plc’s Troubled Subsidiary!

In November 2010, Batash Karim appeared before the judge at Bradford Crown Court.

The 31-year-old, who lived in Gordon Street, in the Yorkshire town of Keighley, was on trial for his role in a violent attack which left a man with life-threatening injuries. During the trial, witnesses described how the victim, who denied in court that he was a member of a local drug gang – he had been hit with weapons including an ax and kicked and punched by a group of men.

Karim and five others were acquitted of attempted murder but found guilty of the lesser offenses of unlawful wounding and violent disorder.

“You came out armed with weapons, prepared for a fight and taking the law into your own hands,” the judge told the six men, as he handed down 18-month prison sentences, according to a report in the Bradford Telegraph & Argus. “It was a horrendous episode of public disorder in Keighley late at night.”

In the same month, Batash Karim, 31, resigned as director of Ezi Floor Limited. Karim had incorporated the mat manufacturer four years earlier, in 2006, giving his address as Gordon Street in Keighley.

Are the two Batash Karim the same person?

According to Victoria plc, this should not matter. But it is an issue that has long worried shareholders of the Aim-listed carpet manufacturer, in which it briefly held shares dropped by as much as 20%. last Monday, after its auditor warned there was a “material risk of fraud” in its accounts.

Grant Thornton’s qualified audit opinion focused on a number of issues at subsidiary Hanover Flooring, identifying “fraud risk factors”, breaches of money laundering regulations and “potential irregularities in respect of certain transactions”. In particular, Victoria’s management and board imposed a scope limitation, preventing Grant Thornton from carrying out further audit work on these matters in Hanover.

Victoria purchased Hanover in 2021 from Batash Karim, who remained as manager of the carpet distribution business. He is also a director of Hanover Flooring alongside Geoff Wilding, executive chairman of Victoria, who has led a series of acquisitions of more than 20 flooring companies since taking the helm in 2012.

Victoria purchased Ezi Floor in 2016 and previously identified the seller as Batash’s younger brother, Saqib Karim.

Victoria downplayed the problems identified in Hanover, calling it a small subsidiary with inadequate record keeping which had no impact on the group’s financial statements. Wilding gave the following account of the matter in a statement published before the company’s AGM last Friday:

[O]over the last week the strong outlook for Victoria has been overshadowed by the notable reaction to our auditor’s qualified opinion arising from incomplete accounting records at a small subsidiary, Hanover Flooring Limited, a business which as a whole represents less than 1.25% of the Group’s turnover. The Board wishes to underline that there has been no wrongdoing in Hannover which has had an impact on the Group’s financial statements and the auditors do not support this either. Hanover’s problem was primarily that it had increased financial risk due to inadequate accounting records associated with no more than £400,000 of customer receipts.

I would like to assure our stakeholders that we have identified the problems in this small subsidiary and assigned additional experienced financial resources who have put in place adequate controls to ensure that adequate accounting records and internal controls are maintained at the high levels that we have firmly incorporated throughout the rest of the Group. From the extensive work undertaken by ourselves and a “Big-Four” accounting consultant, we clearly understood that all due payments were received, no money disappeared and Victoria did not suffer any losses. We are also very clear that there are no other similar concerns across the rest of the Group and our auditors have confirmed that these accounts provide a true and fair view of the Company.

Given these issues, however, it would seem to be relevant information for shareholders if the Hanover manager also has a criminal record. Local news articles about the Keighley attack did not go unnoticed in the market, with numerous investors alerting the FT Alphaville to a possible link.

In light of the speculation we thought it was important to demonstrate whether it is the same person.

This is not the first time we have sought clarity. In August 2022, FTAV asked Wilding about Batash Karim’s apparent conviction. The conversation came in the wake of a short-seller report on Victoria by Iceberg Research, which focused on aspects of the Ezi Floor and Hanover acquisitions, but did not mention Batash Karim.

Wilding would only speak on the subject off the record.

In the wake of the Grant Thornton review report we thought it might be useful to reopen the file and gather more information beyond the corresponding details in contemporary press reports.

Our messages for Batash Karim, left by phone to Hanover employees and via email, went unanswered. Instead, we spoke to a local businessman who said he knew both Saqib and Batash Karim and who asked not to be identified. He assured us that the Batash Karim who runs Hanover has a criminal conviction for taking part in a violent attack.

Next, we asked Bradford County Crown if it could provide the full date of birth of Batash Karim, who was convicted of unlawful wounding and violent disorder in 2010.

While Batash Karim only provided the month and year of birth in the Companies House filing when he became a director of Hanover Flooring, a full date of birth is listed in Ezi Floor’s 2006 incorporation documents. Bradford Crown County came back with a birth date that matched this exactly.

FTAV shared its findings with Victoria and asked for comment. Below is his statement:

There have been no allegations of serious financial misconduct or wrongdoing by Hanover Flooring Limited, a small subsidiary representing less than 1.25% of Victoria’s total turnover. The Company acknowledged that some accounting records at this branch were inadequate and resulted in some customer receipts totaling less than £400,000 being unable to be reconciled. Adequate controls are now in place in line with the high level of internal controls that exist across the Group. From extensive work undertaken by us and our accounting consultants, we have identified that the subsidiary has received a small number of cash payments in excess of the High Value Dealer limit of £8,500. All payments due have been received, no money is missing, there are no allegations of money laundering or financial wrongdoing, and Victoria has suffered no losses.

This article looks at a Victoria employee who was convicted of a crime almost 13 years ago and duly served his sentence, and is a good example of an offender successfully rehabilitated without further instances of wrongdoing. The Rehabilitation of Offenders Act 1974 explicitly states that it is unlawful for employers to discriminate against applicants on the basis of spent convictions and that the employee in question has not been convicted of an offense of dishonesty or financial corruption, nor is it a safeguarding concern . It is very disappointing to see the Financial Times ignore this principle of law and harass a Victoria employee when no charges have been made against her. Michael Hastings, president of Soas University London, founder of Crime Concern and co-founder of Catch22 he wrote in this newspaper in April 2023: “…exclusion from work for people who have already paid dues denies deserving individuals another chance to contribute. This makes our society less prosperous and less equitable.” If only your editorial policy followed suit.

Further reading:
— Victoria plc’s audit nightmare (FTAV)
— Victoria plc: we will need a bigger boat (FTAV)