The Serious Fraud Office today arrested seven individuals in relation to the collapsed firm Axiom Ince and its £66m of missing client money.

The SFO said in a statement that the arrests were made after more than 80 investigators had carried out searches across nine sites in the south east of England.

Axiom Ince was shut down last month when around £66m in client money was found to be missing from its accounts and had been spent. The SFO said investigators will examine how funds passed from the firm’s client accounts with Barclays to the State Bank of India to fund purchases.

The SFO said that the Met Police had referred the case due to the complexity of the alleged fraud; the two organisations will continue to work closely together on the investigation.

Nick Ephgrave QPM, director of the Serious Fraud Office, said: ‘There are a number of significant questions that need to be answered: clients from this law firm are missing many millions of pounds and more than 1,400 of its staff have lost their jobs. The impact on those affected is extremely serious.

‘This morning, we have used our specialist powers to obtain important information that will help us get to the bottom of what happened.’

Axiom Ince was founded in May after Axiom DWFM had purchased corporate and commercial firm Ince Group. In July the firm expanded again through the acquisition of insurance law firm Plexus LLP.

The firm operated 14 branches in England and Wales by the time of its closure, following an intervention by the SRA which the regulator has described as the biggest in its history.

Former managing partner Pragnesh Modhwadia and two other directors were suspended by the SRA in August. Axiom Ince later secured a freezing order for £64m against Modhwadia, whose lawyer said in court that client money had been used to buy Ince and Plexus as well as buy and renovate several properties.