Investment schemes run by former Bury FC chairman collapse; administrator predicts total losses for investors

Mederco, headed by Stewart Day, operated a number of unregulated property investment schemes.

In one, Mederco built out 160 flats in Appleton Point, Bradford, and sold the flats to a wider number of investors, with a guaranteed yield of 9% for five years, and an agreement to buy back the flats at an uplifted price.

The freehold of Appleton Point was sold in May 2015 to E & J Ground Rents No 1 LLP for £850,000, who subsequently leased the basement car park back to Mederco for 999 years at a peppercorn rent. Mederco then sold the car parking spaces to another batch of investors for £9,995 each, again for a guaranteed yield of 9% for five years with an uplifted buy-back after that.

In another, Mederco leased 258 car parking spaces from Bury Football Club for 24 years, and then sold sub-leases in the parking spaces to investors for £9,995. Mederco committed to paying the investors 9% per year for 5 years.

Both these investments collapsed when HMRC issued a winding-up petition, claiming £605,000 in unpaid VAT on the car parking spaces. Day then appointed administrators.

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London Capital & Finance: Smith & Williamson blank potential buyer for Independent Oil & Gas loan

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London Capital & Finance administrator Smith & Williamson's hopes of limiting investors' losses to 83% largely rest on the recovery of £38 million lent to Independent Oil & Gas by via an LCF shell company, London Oil and Gas (also in administration).

S&W's Finbarr O'Connell said earlier in March that he was optimistic about making a "full recovery" of the IOG loan. At time of writing the administrators have not put a figure on potential recoveries for any other of LCF's assets.

RockRose Energy (which is listed on the LSE's main market) has revealed that it has made a £40 million cash offer to buy LCF's debt from London Oil. This deal would apparently result in the hoped-for recovery being realised. However, this deal is in doubt over what RockRose describe as a "lack of engagement" from S&W and IOG.

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London Capital & Finance: CEO and founder both arrested, administrator revises expected recovery downwards

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Two of the four individuals arrested in connection with London Capital & Finance have been named as Simon Hume-Kendall, who founded the company that became LCF and whose companies later borrowed significant sums from it; and Andrew Roberts, LCF's chief executive.

The identities of the other two people arrested remain unknown at time of writing.

As MPs continue to demand answers from the FCA, the political plot has thickened with the news that the administrator may potentially demand the return of over £50,000 donated to the Conservative Party by Hume-Kendall if it can be proved that the money came from LCF. A source close to Hume-Kendall claims that the money came from Hume-Kendall's personal wealth.

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Questions asked in Parliament over London Capital & Finance collapse

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As the fallout from the £230m collapse of London Capital & Finance continues, MPs have stood up in Parliament to ask angrily: where's my job paying £354 an hour?

Excuse me a moment, I've been drinking too many Old Cynics. *sound of herbal tea pouring* There we go.

The Evening Standard's Jim Armitage reveals today that the chairman of the Treasury Select Committee, Nicky Morgan, will formally write to the Financial Conduct Authority to ask why it did not act sooner over the repeated warnings it received from 2015 onwards, and what the circumstances were that made it finally take action.

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