The administrators of collapsed West Ham sponsor Basset and Gold have released their initial report.
Around 1,800 people, described as “everyday investors” by the administrators, invested nearly £36 million into Basset & Gold after being recruited by “internet based marketing and social media campaigns”.
Despite Basset & Gold’s literature claiming that investments were “backed by assets, such as property, corporate debentures and other forms of security in order to PROTECT our investments and your capital”, virtually all of investors’ money was loaned to a payday lender called Uncle Buck.
The opening stanza of the administrators’ potted history reads bizarrely like marketing copy.
The initial target for the business was to provide everyday investors with fixed interest returns, that were easy to understand, using fixed income investments with no additional fees involved.
What this nonsense has to do with Basset & Gold, which gave its investors little chance of understanding that they were investing almost all of their money in a single payday lender, or that “no additional fees” meant 20% of investor monies would be paid to companies controlled by B&G owner Hadar Swersky as commission, is unclear.
The administrators continue:
B&G achieved its targets and provided significant growth year on year.
The only thing that was actually growing was B&G’s debts to investors, from £2m in 2016 to £36 million in 2020. B&G’s (virtually) sole debtor, Uncle Buck, made a loss in all of the four financial years up until it went bust, with its net liaibilities deteriorating from minus £1.4 million in March 2017 to minus £20 million in February 2020.
In April 2019 Basset & Gold stopped marketing its bonds as the FCA started nosing around after the collapse of London Capital & Finance.
Basset & Gold employed an independent firm to carry out a due diligence exercise into Uncle Buck.
They concluded that Uncle Buck would only repay its loans if new money continued to flow in from B&G.
It is believed that the completed independent business review concluded that UB should be able to repay the debt due on time but this was contingent on B&G continuing to fulfil its obligation to UB by virtue of continuing to fund UB’s activities as a HCSTC [payday loans] provider.
In June 2019 B&G were contacted by the FCA who raised concerns about Uncle Buck’s negative balance sheet and bad debt provision. B&G commissioned another independent review, which “portrayed a positive situation with minimal issues identified in respect of UB’s systems and processes”. This failed to mollify the FCA.
Towards the end of 2019 Uncle Buck were supposedly confident of finding £3 million a month worth of lending which would allow it to become profitable. However, in March 2020, “for reasons yet to be explained to the Administrators”, Cypriot shell company River Bloom called in the loan to Uncle Buck, which it was unable to repay, and the jig was up.
Note that as per a diagram in Appendix B, Basset & Gold = River Bloom = River Bloom UK Services = entities controlled by serial entrepreneur Hadar Swersky, which raised money from investors and loaned them to Uncle Buck, a company controlled by a Steven Murray.
While the administrators have managed to recover £2.3 million in cash, they do not expect “any material recoveries for bond holders from the Administration of Uncle Buck”.
Investors hopes for recovery rest largely on the FSCS. Despite minibonds not being covered by the FSCS, Basset & Gold representatives marketed their bonds specifically on the possibility of FSCS compensation if things went south.
Back in 2018, an investor was told by Basset & Gold’s official Facebook channel:
May I add that we are covered by the FSCS in the unlikely eventually of a mis-selling of one of our products. We to date have a 100% payment track record, and have a 98% recommended service rating from almost 200 of our investors. Lastly all our investments are 100% asset backed. Hope this provides more context.
Given Basset & Gold’s systematic use of misleading literature, which banged on about its irrelevant “100% payment track record” and compared its investments to cash deposits, all identified by the FCA as misleading practice, you’ll struggle to find a Basset & Gold “everyday investor” who won’t claim they were missold.
Still, it’s not all bad – thanks in part to sponsorship money funded by Basset & Gold investors, West Ham FC have successfully kept themselves in the Premier League to entertain us all next season. Which, if claims on the FSCS are successful en masse, will be converted into another load of subsidy from the general public. Up the Sc… I mean Hammers!
There is no doubt that Basset and Gold missold their investment to punters with no professional knowledge of what they were buying, ‘retail Clients as they are known’,’ however, was the intention to deceive the bondholder who fell for their deliberate ”scam? and the answer is ”of course yes that was their intention. Was the F.C.A aware of what B&G were doing? and again the answer is yes. There is nowhere to hide for Basset and Gold or the F.C.A. there is also a case for a fraud investigation to be put in motion. The F.S.C.S AND F.O.S must now do the right thing and compensate those that have been Hoodwinked by this unscrupulous crew of swindlers.
These scams / frauds call them what you like need STOPPING NOW . It is out of control, brev is reporting on a regular posting, the amounts of losses are now collosal. The ones who should be jailed are the unregulated smooth talking introducers on 20/25 % comission. I nearly fell for this one 18 months ago would have been £10k.
When I made an investment at their office on Finsbury Circus Uncle Buck or anything about UB was never mentioned. I asked how the money was invested and told it was the purchase at a lower price of unpaid invoices to a company in need of the money ASAP, then claiming the full value from the orginal debtor. Also, the provision of mid-term loans and some dealing with property. I did receive a monthly interest payment for eighteen months from what was intended to be a five year investment with the principle returned.
I am an old age pensioner over 80 years of age and i am disgusted at the lack of protection shown to me and thousands of other pensioners by the FCA under the directorship of Andrew Bailly where we have been scammed out of our life savings by an organized criminal gang during his watch and nobody seems to care about our plight and a wall of silence has been set up in answer to our plea for justice I am a bond holder with Basset and Gold which went in to administration with the loss of all its clients capital on 1st of April 2020 B&G being only one of many companies dealing in mini bonds to go belly up in the last 2 years also with the near total loss of all their investors capital B&G and all of these other companies were set up TO FAIL at some point due to poor management In2016 a criminal Dror Sordo convicted in America of fraudulently miss selling binary options and fined 1.5 million dollars was allowed to creep around the sleeping watch dog and set up B&G as a trusted trader also in 2016 unbelievable The reason why all of these companies were set up was to steal British pensioners lump sums The Government are partly to blame for putting our pension pots in to our own hands at a time when interest rates at the high street banks were at an all time low pensioners seeing there capital diminishing in real terms due to inflation were sitting ducks for the fraudsters to set up these companies with unrealistic high rates of interest based on lies and glossy brochures Under Bailly the scamsters were allowed to set up branches of their offshore companies in the UK ONCE THESE COMPANIES WERE SET UP IT WAS PLAIN SALLING FOR THESE SCAMMERS their clients capital passed out to a plethora of related companies and into secret offshore accounts out of the reach of British jurisdiction and there seems to be no power on earth that the many millions of pensioners savings can be recovered thus the silence we are all met with when we ask for justice an embarrassed high level cover up
It is now October 14th over six months since Basset & Gold went into administration. Yet up to now have not received any updates from the fscs as to the fate of the three isa bond’s my wife and I invested in.