Carphone Warehouse co-founder quits

Carphone Warehouse co-founder David Ross has resigned after failing to declare that he had used shares in the company as collateral against personal loans.

Ross resigned as a director on Sunday after using 136.4 million of his shares in Carphone Warehouse against the loans, said Carphone Warehouse chief executive Charles Dunstone on Monday.

"Over the weekend the company was notified that deputy chair David Ross pledged 136.4 million shares in the company against personal loans," said Dunstone in a conference call. "As a result David has pledged his resignation from the board."

Under normal procedures, the Carphone Warehouse would have made official announcements about Ross's use of the shares as collateral for the loans, taken out between 2006 and 2008. The company had previously made announcements about share pledges Ross made in 2001 and 2003, but failed to do so over the later loans as Ross had not informed the company about his use of the shares during this particular period.

Dunstone said the reason Ross had not followed the procedure over the past two years was "probably an oversight or a misunderstanding".

In a statement Carphone Warehouse said Ross had not defaulted on any of his loans, and that he had "no current intention to sell any of his shares in the company".