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Tuesday, 25 July, 2000, 18:41 GMT 19:41 UK
Vice charge director resigns
Houston skyline
Mr Hinkley was arrested by vice squad officers
Stagecoach executive William Hinkley, who was arrested by vice squad officers in Houston, Texas, has resigned from his post.

The Perth-based company had suspended the 51-year-old on Tuesday morning after hearing about his arrest in the US.

But just before 1800BST on Tuesday, a spokesman for Stagecoach Holdings Plc told BBC News Online Scotland that the London Stock Exchange had been informed of Mr Hinkley's resignation.

He had been with the company for 14 years and had been in the transport business for more than 35 years.

It is believed Stagecoach is in the process of negotiating a financial settlement for Mr Hinkley.

Police in Texas said Mr Hinkley had been arrested following an incident in a room at the Omni Hotel in the "uptown area" of Houston, on 28 June.

Houston police car
Police swooped on a Houston hotel
He was detained by vice squad officers who had been posing as male prostitutes.

Houston Police Department said: "Vice squad officers received a call for solicitation of prostitution.

"After arrival, an agreement was made to a sex date for a fee. Hinkley was arrested and booked in the Houston city jail and then the county jail."

Mr Hinkley, from Bassenthwaite, in Cumbria, appeared at Harris County Court on 6 July and was released on $500 bail. He was ordered to re-appear in court on 24 August.

On the jail booking sheet, he gave the business name Cumberland Motor Services, of Whitehaven.

Promotion of homosexuality

Stagecoach has faced turbulent times recently and shares fell when news first broke about Mr Hinkley's arrest.

Its chairman, Brian Souter, recently funded a campaign opposing the repeal of Section 28, the law banning promotion of homosexuality in Scottish schools.

Mike Kinski resigned as chief executive in February after the company announced it was facing losses on its 1.2bn US investments.

Mr Kinski, who earned 777,000 last year, left after only two years in the job.

Brian Souter
Brian Souter: Keep the Clause backer
His sudden move, coupled with the resignation of the head of the US coach division, Larry King, shocked the City.

Mr Kinski was replaced by Brian Cochrane, the former finance director.

The company denied that personality clashes with founder and executive chairman Brian Souter were behind Mr Kinski's sudden departure.

Mr Hinkley became a director and chairman of the firm's UK bus division after a spell as managing director of the company's Cumbrian operations.

According to company records, he was paid more than 250,000 last year.

Mr Hinkley, who is thought to be still in the US, told the company about his plans to resign on Tuesday.

It is not clear whether he has spoken to Mr Souter about the matter.

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The Section 28 battle
Controversy and debate
See also:

25 Jul 00 | UK Politics
Peers vote to keep gay ban
21 Jun 00 | Scotland
MSPs abolish Section 28
14 Feb 00 | Business
Shock resignation at Stagecoach
05 Apr 00 | Business
Stagecoach 'staying in market'
14 Jun 99 | The Company File
Stagecoach expands into US
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