Exclusive: Collapsed companies boss held in fraud inquiry

James Burdall was arrested at his home in Sheffield with detectives also seizing a range of items including computer equipment.

South Yorkshire Police is investigating the alleged movement of more than 1m from companies controlled by Mr Burdall but owned by former Sheffield-based entrepreneur Lawrence Wosskow.

Mr Burdall was the sole director of the Out of Town Leisure Group, a food retail chain which went into administration last Wednesday with the loss of 350 jobs, including 100 at outlets at the Meadowhall shopping centre in Sheffield. The company is owned by Mr Wosskow, who is not under investigation.

On Friday, Mr Burdall's Forge Dam company, which trades as both Formtech Creative Engineering and AMA Displays, with sites in Leeds and Dewsbury, also went into administration with the loss of a further 19 jobs.

South Yorkshire's fraud squad is understood to be investigating the alleged movement of money through Out of Town's accounts

The investigation also includes hundreds of thousands of pounds alleged to have been removed from the accounts of Bradwells' Ice Cream, a business based in the Hope Valley in the Peak District, which is also owned by Mr Wosskow.

Mr Burdall, 46, was a director of Bradwells but resigned when his business affairs began to unravel 10 days ago.

Mr Wosskow, the former co-owner of the Little Chef chain of restaurants, has promised funding to keep Bradwells running.

He handed control of his businesses to Mr Burdall, a close friend, when he emigrated to the United States three years ago after suffering ill health. He has declined to comment on the police inquiry but is understood to be devastated by the impact on his businesses.

A South Yorkshire Police spokesman said: "Following the fraud allegations received from a Sheffield company last week, officers from South Yorkshire Police searched a property in the Hangingwater area of Sheffield on Friday evening, July 16.

"As a result, police seized a number of items and a 46-year-old man was arrested and bailed pending further inquiries."

Lawyers and accountants connected to the companies owned by Mr Wosskow began investigating transactions 10 days ago following staff concerns.

Police were called in last Wednesday. On the same day, Out of Town went into administration following Mr Burdall's resignation as sole director.

As a result, Meadowhall outlets French Cafe, Mamma Amalfi, Thyme Tea Garden, the Lounge bar, two outlets of Fresh Sandwich Shop and Potato Bakehouse immediately closed on Thursday with staff arriving to find their workplaces shuttered up.

Mr Burdall was not available for comment.