The administrators of collapsed unregulated property investment scheme Harewood Associates have released their latest update.
Harewood Associates raised £32m by advertising bonds and preference shares directly to investors. The scheme collapsed into administration in June.
In their initial report, the administrators wrote off £36 million of the £40 million which Harewood Associates lent to linked companies, including £17 million loaned to Harewood Venture Capital and £19 million loaned to Sherwood Homes.
The administrators have now also written off a further £1.2 million from the “Equiscale” investment and £1 million owned by a company called Southworth Construction (owned by a James Cuniff).
The administrators have successfully raised £721,000 (after fees and costs to date), mostly representing a £310,000 property in Shropshire and £500,000 recovered from Lansdowne Investment Partnership (LIP), another Kiely-owned company.
LIP owes Harewoods a total of £2.8 million and has agreed to pay £500k upfront with the remaining £2.3 million payable in instalments to October 2020, with security taken over several properties owned by the Kiely-owned partnership.
Harewood director Peter Kiely also repaid a £14,600 director’s loan account. Which is nice.
The status of claims by investors in Harewood preference shares are being reviewed by a barrister. Preference shareholders are normally viewed as owners rather than creditors.
However much the administrators manage to recover from what little remains, it is clear that, with 93% losses now being the “best case”, Harewoods is a virtual write-off.
The difference between Harewood’s claims that its bonds were “safe and secure” and “secured by way of debentures on UK residential developments” could not be starker. The only thing backing Harewood’s bonds were loans to other Harewood companies that have been mostly written off.
No action has been taken by the FCA or any other enforcement body against Harewood for illegally and misleadingly promoting its bonds directly to investors that is in the public domain.
I’m so angry , invested £50,000 in feb 19 with assurances that a third of all investments were not put at risk and the infamous cast iron guarantee brochure . The shit was going down before Christmas 18 and Kiely in a letter to a creditors meeting stated that no new investment should be sought after Christmas 18. Yet his partners in crime including Kay Kennedy continued to solicit investment in 2019 with no mention of the mess the company was in , in fact the opposite, that it was thriving . Am dismayed Begbies Traynor have done nothing regarding the fraudulent activity except from line their pockets .