Irish entrepreneur Peter Conlon, whose online donations platform is alleged to have withheld €3.8 million from charities, has been in custody in Switzerland since before Christmas on suspicion of embezzlement.
The public prosecutor's office in Zurich has confirmed the Swiss-based businessman, whose liquidated Dublin company Pembroke Dynamic Internet Services is the subject of an inquiry by the Charities Regulator, was arrested at Zurich Airport on December 22nd, 2017.
The authorities in Switzerland, where he has been living in recent years, detained the Leitrim-born businessman on the back of a criminal complaint from the International Federation of the Red Cross.
The white-collar crime unit of the office of Zurich public prosecutor said that Mr Conlon (63) remains in custody.
The prosecutor's office also said it opened an investigation into Mr Conlon and the fundraising activities of Ammado AG, the Swiss company behind the website operated by Pembroke, on October 20th last.
The Geneva-based Red Cross lodged a criminal complaint on September 28th, 2017, claiming embezzlement and dishonest business dealings by Ammado.
The Red Cross is owed about €1.6 million after the Dublin-hosted platform failed to pass on charitable donations raised on its online platform.
The charity alerted its branches about “business conduct issues” with Ammado in April 2017 and told them to suspend immediately using the platform after it failed to remit a scheduled payment.
The Zurich prosecutor said it searched Ammado's offices in Zug, Switzerland, on December 22nd and found evidence suggesting that several million euro in donations were not forwarded to other charities leading to the arrest of Mr Conlon.
The entrepreneur, a former IDA executive and a qualified barrister and accountant, is well-known in Irish business circles .
He has a track record as a serial entrepreneur, setting up tech firms MV Technologies, which was sold in 2001 for €100 million, and Xsil in Dublin. He established Ammado about a decade ago.
The online platform linked donors and charities, raising millions of euro in funds for humanitarian and charitable causes. The High Court heard this week that he failed to segregate company funds from the charitable donations raised and he used funds raised for charities for personal expenditure.
Liquidator Myles Kirby of Dublin accountancy firm Kirby Healy secured a court order freezing Mr Conlon's worldwide assets after claiming that the businessman was "guilty of very serious misconduct".
Mr Kirby has written to 800 charities connected to Ammado informing them he was investigating the extent of the shortfall at Pembroke. He warned the investigation into the company’s finances could take some time.
Although Ammado is not a registered charity, the Charities Regulator has opened an inquiry into the company’s fundraising activities.
The regulator reminded registered Irish charities to notify its office in writing if they have any reasonable grounds for believing that a criminal offence has been committed.
The Red Cross said it did not officially notify other charities about Ammado’s missed payment or its concerns about the platform’s failure to pass on donations, because lawyers advised against it.
“Our legal advice at the time prohibited us from making any public statements or formally contacting third parties as the matter was the subject of a criminal investigation,” said the spokesman.
However, concerns about Ammado’s activities were circulated informally.
Charities that have fundraising connections with the platform are investigating whether they received all the donations due to them.
Oxfam Ireland, which raised €5,500 through its Ammado account from 2009 to 2016, said it was conducting an internal review and asked the platform to close its account and delete its page.
Michael Conlon, the businessman’s brother who resigned as company secretary of Pembroke in November, declined to comment.
* This article was amended on February 2nd, 2018. Michael Conlon was Pembroke company secretary, not director as originally reported.