A millionaire internet tycoon has been fired from his taxpayer-backed investment business after a sexual assault charge.

Stefan Glaenzer has been removed from Passion Capital, which is funded by the British Business Bank and is the biggest shareholder in the banking app Monzo, after an alleged incident last year.

Mr Glaenzer, 60, was arrested by the Metropolitan Police in September following a complaint in June, and charged with sexual assault last month.

London-based Passion said it was moving to sever all ties with Mr Glaenzer and will seek to stop him sharing in future profits.

The revelation will add to concerns about the male-dominated venture capital industry.

Mr Glaenzer, a serial entrepreneur who made £23m when he sold the British start-up Last.fm, co-founded Passion in 2011.

It has become one of Britain’s best-known start-up investors, owning a stake in Monzo worth close to $1bn (£760m), as well as holdings in billion-dollar start-ups GoCardless and Marshmallow.

Mr Glaenzer had ceased to be involved in investing decisions in 2018, but continued as a manager of existing funds and served on the boards of companies that Passion had invested in.

Passion informed investors and start-ups about the decision to fire him in recent days. The success of its investments had put Mr Glaenzer in line for rewards likely to be worth tens of millions of pounds.

Passion said: “Passion Capital recently learned of criminal charges brought against Stefan Glaenzer, who has not had an active role with the firm since his departure in 2018.  

“Whilst we are not privy to specific facts around the charges as Mr Glaenzer is not commenting on the events, we have moved to sever any and all trailing contractual commitments that remained between him and our historic funds and activities.

“This means that we are in the process of removing his involvement and membership in all Passion entities that he held from his previous role, and are actively seeking to exercise any rights that would restrict him as much as possible from benefiting financially from any successes.”

Passion said: “Whilst we continue to consider our legal position and options for holding him to account for bringing the firm into disrepute and allegedly behaving in a manner wholly incompatible with our values, we offer our most heartfelt apologies to all of our portfolio company founders and teams, co-investors and fund investors impacted – and most importantly any victims.

“Our deep regret is that we did not act to sever all agreements and revoke Mr Glaenzer’s rights sooner.

“To be very clear, we unequivocally condemn any forms of assault or harassment in any situation and there are no words to describe the shame we feel for not speaking up and doing more to sever all ties as soon as we learned of the allegations last month.”

The Met Police said: “Stefan Glaenzer, 60, of Kensington Park Gardens, W11, was arrested in September 2021 following an allegation made to police in June of the same year.

“On Monday, March 7 he was charged by postal requisition with one count of sexual assault by touching.”

Mr Glaenzer will appear at Westminster Magistrates Court next week.

The taxpayer-funded British Business Bank invested £17.5m in Passion in 2015 as part of an effort to improve funding for technology start-ups.

It said: “As a limited partner, the Bank has supported Passion Capital in its actions to remove Stefan Glaenzer from these funds.

“The treatment of carried interest from the fund is a matter for Passion Capital.”

Mr Glaenzer did not respond to requests for comment.