The luxury goods that may repay LCF savers
Helicopter and horses could be seized and sold
HORSES, a helicopter and land in the Dominican Republic are among assets that could be sold to pay back savers caught in the collapse of London Capital & Finance (LCF).
The firm went bust owing £237m to 11,500 customers and is being wound down by administrators, the financial services group Smith & Williamson.
Savers thought their money was being invested in hundreds of firms but investigators have found bosses poured it into their own luxury lifestyle ventures.
Administrators are now seeking to raise as much cash as possible to refund savers from a sprawling range of assets held by a web of companies with links to businessmen at the heart of the scandal.
So far, vehicles and a horsebox owned by LCF have been sold for £202,122. Smith & Williamson are pursuing a helicopter, horses and land that was to be developed as resorts in Dominican Republic.
However, it is feared that savers may get only a quarter of their cash back. And in a fresh blow, an update yesterday said a partrefund expected at the end of this summer was likely to be delayed.
The slow progress has been partly blamed on a lack of cooperation from businessmen connected to LCF. Administrators said ‘many millions of pounds’ were funnelled to Simon HumeKendall, Elten Barker, Andy Thomson and Spencer Golding, business associates with ties to firms given LCF investors’ cash.
But all four men, who were arrested in March in connection with the LCF scandal, have provided little assistance.
Thomson and Hume-Kendall originally ‘verbally agreed’ to hand over money they received until LCF bondholders were repaid in full, administrators claim, but Thomson now disputes this. And Golding and Barker were asked to enter a similar arrangement but have since indicated they would not do so.
Administrators said the debts owed to LCF as of January included £154.6m by London Group, an outfit owned by HumeKendall and Barker. They have been unable to account for a total of £28.5m made in loans to two London Group subsidiaries.
And Portuguese lawyers have been brought in to help recover £12m in debts owed by two of its other subsidiaries that were supposedly building resorts in Cape Verde, off west Africa.
LCF is also owed £70.1m by Prime Resort Development and £12.3m by FS Equestrian Services, which Golding was a patron of. Prime Resort is thought to own land in the Dominican Republic which LCF may have rights to. Administrators are trying to track down information on horses owned by FS Equestrian Services. A further £839,776 plus interest is owed by London Financial Group, the parent of LCF which Thomson was sole director and shareholder of.
Its assets include a helicopter formerly owned by Golding which administrators want to sell. Smith & Williamson may take legal action to recoup funds in some cases and has run up a bill of £2.3m for services so far. Administrator Finbarr O’Connell said: ‘[It] has been extraordinarily complex. To make matters worse, administrators have had almost no cooperation from the main parties involved with LCF, both the company and its borrowers, which the administrators consider to be deliberate and probably coordinated.
‘These matters have significantly added to both time and cost. What is encouraging however is the work is bearing fruit and is expected to result in further recoveries.’