WE’D LOVE HE’S DUNG TO KNOW WHAT WITH OUR CASH
Business people write off thousands as Insolvency Service starts probe
Investors fear they have lost millions of pounds in a failed eco scheme to turn cow dung into fuel.
Scots farmers are among those who put cash into a firm set up by businessman Martin Frost whose dealings are now part of a probe by the UK Government’s Insolvency Service (IS).
Documents seen by the Sunday Mail show an estimated £8million has been paid in by shareholders to the dung conversion scheme since 2014 – but the product has never gone on sale.
Eight years later stockholders – who invested up to £1.25million – have still to see a return on their cash or a dividend on their shares.
Frost’s aim was to establish “cow palaces” in Scotland and Ireland where the high- quality cattle would produce better beef and milk, with their waste converted into cheaper, cleaner diesel using chemical additive Avocet.
The scheme was piloted at Harcarse H i l l Farm a nd Sunwick Farm, both in Berwickshire.
Edinburgh businessman Alistair Mun ro b ou g h t £ 750,000 shares in 2017 in cash and was g iven a fur ther £250,000 in shares for subsequent work he did for Frost.
Alistair, who also has business interests in Dubai, said he had given up hope of getting any of his money back.
He added: “I regret getting i nvolved wi th Fros t , particularly as the concept could have been a success.”
Alistair’s job was to arrange the manufacture of the Avocet used in the process. At one stage he even spoke about the concept at the UN Assembly in Geneva.
Alistair added: “The plan was to generate methane from the cow dung and convert that methane to methanol. The Avocet additive goes into the methanol to allow the replacement of diesel with the minimum of eng ine modifications.
“I did quite a bit of due diligence and at first it appeared to be a perfectly credible and viable business. But Frost made no effort to commercialise it, even though the idea was good.”
Two firms Frost used to launch the green diesel – Avocet Infinite and Omega Infinite – are in
liquidation with shareholders demanding answers.
On Thursday, Frost , 73, cancelled an online shareholders AGM where it is claimed that he planned to offer investors their money back at 1p a share, compared with the £ 1 they originally paid for them.
It would have meant anyone who had put in £1 million, would only have got £10,000 back.
Frost, who lives in Scarborough, Yorkshire, set up Avocet Infinite in 2014 to launch the initiative. When Avocet went bust, the shares were transferred to a new firm Omega Infinite which went into liquidation in March last year.
A new shares issue was then made by a third Frost company,
Avocet Natural Capital. Avocet shareholders include fami ly members of Jacob Rees-Mogg – the Leader of the House of Commons – and ex- deputy prime minister John Prescott.
Another angry shareholder, Gregor Walker, 57, runs a groundworks company in Kelso.
After meeting Frost in 2014, he was sold on the diesel idea and bought £20,000 worth of shares.
He was given a further £ 454,515 in shares as payment for farm work. Gregor believes they are now worthless.
He added: “I have basically written off the money now and am sickened at the way I have been treated. I have heard nothing from Martin Frost for a long time and don’t expect to. I wish I had never got involved with him.
“I think most people who have Avocet shares feel like that.”
Sandy Jeffrey, 65, who lives in Wooler, Northumberland, was given £ 200,000 of share capital for work he did for Frost, which he now believes is worthless.
Over a two- year period he supplied management services to Avocet, buying about 1000 cattle for the proposed cow palaces.
He said: “My accountant has already advised me to write off £ 60,000 worth of my shares.
“I regret getting involved with Frost but I also regret getting other people involved, which is hard to live with.”
A prominent Borders farmer,
who asked not to be named, said he had lost about £ 1million in the scheme through share purchases.
He added: “I would like to know where all the money has gone.
“At the time we were told the new fuel would revolutionise transport and save money for farmers who could make it themselves on site. I accept that I won’t get my money back, if I get anything at all it will be a bonus.”
The farmer first got involved with Frost in February 2017 when he was shown around Harcarse, near Duns.
He added: “A clean replacement for diesel was promoted as something that every farm in Europe would be using. A huge amount of people in the Borders backed the concept.
“There are some really sad cases, where people have put their kids’ inheritance into it. The investors would like to knowknowwherethemoneywherethemoney has gone. I did due diligence at the time but I obviously didn’t do enough. I have tried to wipe this from my memory. It’s not my proudest moment.”
Another investor, Stuart Lucas, 68, paid about £1.25million for Avocet Infinite stock, which he also believes is worthless. His London firm Asset Match sells stock in unlisted firms such as Tot tenham Hotspur and Brewdog.
Asset match was paid a further £104,000 in stock for work that Stuart did for Frost. Stuart says he doesn’t think he will get his money back. He said: “I always knew it was a highhigh-risk investinvestment. Martin and I have fundamental differences in the way companies should be run. I stupidly did not do my own due diligence to the level that I should have and it has cost me £1million.
“I know one guy who bought £ 75,000 in shares with his own money and that is a significant amount of his net worth. That makes me feel very uncomfortable.” Directors can be banned for up to 15 years if they are found to be in breach of company rules.
An IS spokesman said: “We do not
comment c on investigatory activity, a including whether a company c is being investigated.” Yesterday, Frost denied that investors in had lost cash or that their th shares were worthless. He said sa he was not aware of any IS probe pr and insisted the scheme would wo be going to market and that there the was still lot of interest.
He H added: “A new fuel often costs cos £ 400million-plus to obtain commercial com approval – Avocet perfected perfe this on less than £10million.
“OOn other Avocet products there is wiwide scale support.”
He said that fol lowing the formformation of Avocet Natural Capital, from Omega Infinite, he had given each investor an additional 10 per cent ffrom his personal shareholding.
Frost added: “Omega Infinite shares relate to a company in liquidation, nevertheless it is unique that even these shares are realising money.”
Frost also denied of fer ing shareholders 1p for their Avocet shares, claiming this related to another company called Glenfros.
In 2006 at a Court of Session hearing in Edinburgh, Frost was declared a vexatious litigant by three judges for habitually raising legal proceedings without reasonable grounds.
The court heard over a 25-year period he had been involved in more than 500 court actions. In 2005 at the High Court in England, costs of £200,000 were awarded against him, which led to his personal bankruptcy.
I regret getting involved.. and getting other people involved