Krono Partners launched in 2013 and offered unregulated seven-year bonds paying interest of 8% per year, plus variable payments of 20% of the company's assets. Krono Partners aimed to generate returns by investing in distressed real estate in the United States and Europe.
In 2018, with the distressed asset bonds approaching their five year anniversary, Krono Partners issued a further series of bonds, this time offering 10% per year over five years. This time investors' money was to be used to invest in bridging finance for small and medium enterprises.
According to an investor on Moneysavingexpert.com, Krono Partners stopped paying interest in the beginning of 2018, still two years shy of the repayment date of its 2013 bonds.
A Companies House filing yesterday reveals that Krono Partners has gone into administration.
Independent Portfolio Managers played a crucial role in the collapse of two unregulated bonds, Secured Energy Bonds and Providence Bonds.
Independent Portfolio Managers was an FCA-regulated company that issued financial promotions on behalf of Secured Energy and Providence. Without those FCA-regulated promotions, Secured Energy and Providence could not have been promoted to UK investors.
After those two bonds collapsed with total losses, investors in both Secured Energy and Providence made formal complaints to first Independent Portfolio Managers and then the Financial Ombudsman.
Just over a year and a quarter since it accepted the cases, The Financial Ombudsman has now began issuing rulings.
Providence offered supposedly asset-backed bonds paying 8.25% per annum. The scheme collapsed in 2016 with total losses to investors.
Providence has now made the step from failed investment to fraud, with Jersey financial adviser Christopher Paul Byrne convicted of fraud for recommending that his clients invest in Providence funds.
Fortitude Capital is offering unregulated one year bonds paying interest of 8% per annum.
Selected introducers are offering enhanced terms whereby the interest rate is increased to 12% per annum for investments above £50,000, 11% for investments between £25,000 and £50,000, and 10% for investments between £10,000 and £25,000.
Fortitude Capital intends to use its investors’ money for “algorithmic trading” in the foreign exchange (forex) market.
Continue reading for a review of Fortitude Capital’s bonds.
The administrators of the collapsed unregulated bond scheme Privilege Wealth have filed the first of their six-monthly updates.
The full administrator's report can be viewed on Companies House.
Readers will recall that one of Privilege's main underlying investments was the loan book of a company called Rosebud which extended payday loans to the Sioux Indian Tribe of South Dakota. Since the administrators' initial report, the administrators have succeeded in recovering $87,000 from a Rosebud escrow account (£63,000).
Some further small sums recovered from various parties bring the total funds recovered from Privelege to £91,000. The administrators are due 30% of all recoveries, and this plus legal and other costs take the net amount recovered to £51,000. With Privilege's Wealth's debts identified as £4.2 million, clearly this will not go far among the creditors.
Davenport Laroche offers an unregulated investment in shipping containers, which promises returns as follows:
- "Conservative Lease" - fixed returns of 12% each year
- "Higher Income Lease" - variable returns, described as "up to 24.13% ROI". Later in Daveport Laroche's promotions, this 24.13% figure is also described as the historic return for 2016.
In both cases, Davenport Laroche promises to buy the containers back after 5 years at cost price.
for a review of the Davenport Laroche investment.
Previously on this blog I have preferred to review individual investments. But there is currently a plethora of firms offering investment in a myriad of hotel rooms, and as it's impractical to review each hotel room individually, I decided to write a general guide.
This article is about investments which work as follows:
- A larger property is divided up into individual units, and the units are sold to investors. For example, a hotel is divided into hotel rooms, and the hotel rooms sold to investors. Or a car park may be divided into parking spaces and the spaces sold to investors, or a self-storage facility may sell off its storage pods. The promoter of the scheme still owns the hotel, the car park or the storage facility.
- Unlike a buy-to-let flat or similar property investment, the investor does not manage the investment and is not responsible for generating the return. This responsibility remains with, or is "leased back" to, the promoter of the scheme to which the investors gave their money.
- Unlike a buy-to-let flat, the investor does not receive a variable rent, but is promised a fixed return by the scheme promoter. Promised returns of 8% - 12% are common, although it can be more or less.
(In some investments it may be optional to "lease back" the investment for a fixed return. But in practice, the vast majority of those who buy the investment will. It is after all unlikely that they will do better by managing the investment themselves than the 8 - 12% the promoter is offering.)