City of London Police are investigating Lloyd's of London broker Besso after allegations of fraud arose regarding irregularities in client funds.

Besso has confirmed that it has dismissed a member of staff after an internal audit suggested that the employee had used the funds to artificially increase profits at his division. Reports said this was apparently aimed at increasing his bonus.

A Besso spokesman said that the clients had been reinstated in their financial position and that none of them intended to switch their business to other brokers. The loss is intended to be in the region of £2m.

The company said it had informed the FSA as soon as it was aware of the problem and welcomed the procedures it had in place to deal with the situation quickly.

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