£7m debt but Wrapit boss 'not responsible'

By Marcus Dysch, August 12, 2010

The former boss of an online wedding gift company which went into administration with debts of £7 million maintains she was not responsible for the firm's collapse, despite being disqualified from acting as a company director.

Wrapit retail director Pepita Diamand said "hand on Torah" she had acted with the best intentions. Hundreds of Jewish couples were left without presents and their guests without refunds after Wrapit folded two years ago.

Ms Diamand and Peter Gelardi, former managing director, have been banned for seven and eight years respectively following an Insolvency Service probe into their conduct.

Ms Diamand, a Toronto-born Jewish ex-fashion writer, set up Wrapit in 2001. Earlier this year she re-launched her career as a brand consultant.

She said: "The investigation was a very difficult process. I didn't have the financial ability to defend myself. The financial transactions were not my doing and I will not accept responsibility for the downfall of Wrapit.

"I say hand on heart, hand on Torah dare I say, that everything I did was to my knowledge with the best intentions for our couples. I'm sorry so many people were let down."

Insolvency investigators found that between June and July 2008 Wrapit made false credit card refunds totalling £243,445. The "refunds" were processed even though no underlying sales transactions had taken place.

The money was used to pay staff salaries, suppliers, and Mr Gelardi and Ms Diamand.

The improper transactions allowed the company to continue trading and take advance payments of at least £872,000 from new customers despite already being insolvent.

Investigators found Mr Gelardi had made the decision to make the false refunds and Ms Diamand had assisted him in implementing the process.

The company accounts show Wrapit never made a profit and when it collapsed in August 2008 there were 72,000 undelivered wedding gifts for which the company owed more than £4m.

Last updated: 5:13pm, August 12 2010