Katar Investments offer unregulated fixed-interest bonds paying 18% over 18 months (equivalent to 11.67%pa) with a minimum investment of £25,000.
It also offers a range of individual residential and commercial investment properties, which are beyond the scope of this blog. This article will focus on the fixed-interest bonds.
Open to new investment.
Who are Katar Investments?
Katar Investments’ website lists the directors as Sam Tarling (founding partner and sales director), Jenny Gallgher (founding partner and marketing manager) and Joe Ferreira (director).
Companies House shows the controlling owner of the company is Geoff Siden (who owns 54% of the company). Geoff Siden was previously the owner of Worldwide Leisure Group, a timeshare sales company, but online reports suggest he is retired. Sam Tarling, Jenny Gallagher and Joe Ferreira own the remaining shares.
Katar Investments’ latest accounts (31 August 2016) show that it has £9,291 in net assets (pounds, not thousands or millions). The accounts are micro-entity accounts, meaning that the company was small enough that it does not have to be audited or provide full financial information to Companies House.
How secure is the investment?
These investments are unregulated corporate loans and if Katar Investments defaults you risk losing 100% of your money.
Your return is dependent on Katar Investments being able to make sufficient returns from its investment properties to pay investors 11.67% per annum. If it fails to generate sufficient returns to pay 11.67% per annum after costs, there is a risk of default.
The website states “First Legal Charge on the underlying asset class”. While it is not clear what the underlying assets are, investors should bear in mind that if for whatever reason Katar Investments is unable to sell the assets your bond is secured on for enough money to cover its obligations, investors still risk losing up to 100% of their money.
Should I invest with Katar Investments?
As with any unregulated corporate bond, this investment is only suitable for sophisticated and/or high net worth investors who have a substantial existing portfolio and are prepared to risk 100% loss of their money.
This particular bond is advertised as asset-backed. Before putting any reliance on the security backing the bond, investors should undertake professional due diligence to ensure that a) the security exists b) in the event of default, the security could be easily sold and would raise enough money to cover all investors’ money c) the charge over the security has been properly and legally recorded.
Before investing investors should ask themselves:
- How would I feel if the investment defaulted and I lost 100% of my money?
- Do I have a sufficiently large portfolio that the loss of 100% of my investment would not damage me financially?
- Have I conducted due diligence to ensure the asset-backed security can be relied on?
If you are looking for a “secure” investment, you should not invest in unregulated products with a risk of 100% capital loss.