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FCA launches probe into scandal-hit Telit

The Financial Conduct Authority has begun an investigation

By Mark Kleinman, City Editor

The City regulator has launched an inquiry into the London-listed technology company Telit Communications, weeks after its chief executive departed amid doubts about his true identity.

Sky News has learnt that the Financial Conduct Authority (FCA) has begun making inquiries into events at Telit, which makes products enabling access to the Internet of Things (IoT).

Details of the FCA's investigation remained vague on Thursday, although it is expected to include examining the timing and disclosures relating to a share sale in May by Oozi Cats, the former chief executive.

That sale was carried out by Berenberg, the investment bank which is joint broker to Telit.

Subsequent share transactions are also understood to be attracting the scrutiny of regulators.

Finncap, which acts as Telit's nominated adviser – a required role for companies listed on London's junior Aim stock market – and joint broker, was appointed to those roles in August, two days before Telit's board hired lawyers to investigate a previously undisclosed indictment against Mr Cats in the US.

Sources said that the FCA, which has responsibility for the UK Listing Authority, had notified both Telit and Finncap of its probe, although they added that it was "at a very early stage".

The technology group has seen its shares slide by a third over the last 12 months as it has struggled to reassure investors about the health of its finances.

Mr Cats had originally been placed on leave by Telit amid suggestions of links between him and a US fugitive by the name of Uzi Katz who was accused of wire fraud in Boston in 1992.

Telit, whose clients include Tesla, the electric car manufacturer, is now searching for a permanent replacement for Mr Cats and several independent non-executive drectors.

Sources said that a string of candidates approached to join the board had turned down the opportunity on account of the uncertainty about its future.

Telit has begun exploring a sale of parts of its business which it regards as not core to its long-term future, including its automotive division.

Telit, the FCA and Finncap all declined to comment.

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