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