Independent Portfolio Managers, the minibond promoter which was hit by a slew of Ombudsman complaints for its role in the collapse of Secured Energy Bonds and Providence Bonds, has gone into liquidation.
When I last reported on the company in late October I overlooked that a creditor had already petitioned to wind up the company. This petition was heard two weeks ago, and the winding up commenced on 14 November.
Interestingly, the creditor who brought the petition against Independent Portfolio Managers was the administrator of Secured Energy Bonds.
Back in September Chris Byrne, an adviser for Jersey-based Lumiere Wealth, who advised unsophisticated investors to invest in the unregulated Providence Bonds opportunity, failing to disclose that Lumiere Wealth was in fact owned by Providence, was convicted of fraud.
Byrne was convicted not just for his misselling of Providence Bonds, but for other frauds including conning a near-blind woman into making a £1 million personal loan to him.
News from Jersey then went silent for a month and a half. Until last week, when the Jersey Post revealed that Byrne's sentencing had been delayed at the last minute, on the grounds that Byrne had been helping the police of neighbouring Guernsey with their inquiries into a related investigation.
Four days before it was due to be dissolved over its failure to file annual accounts with Companies House, Independent Portfolio Managers has had the strike-off action against it suspended.
The reason the action has been suspended is not known for certain, but the most likely reason is an objection by a creditor. If IPM had been dissolved, all its assets (if any) would have become property of the UK Government.
As I previously covered, in July and August IPM was ordered by the Financial Ombudsman to compensate three investors in Secured Energy Bonds for its failings in producing Secured Energy Bonds' literature, and for giving a false impression that Secured Energy Bonds were more secure than other unregulated corporate loan notes.
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.
Providence Bonds plc offered unregulated corporate loan notes offering annual interest of up to 8.25% over a term of four years.
The scheme first showed signs of difficulty in June 2016, when payments were made late. In quick succession it emerged that a Providence subsidiary was under investigation in the USA for offering fraudulent and unregistered securities and had been ordered to stop trading. After that the Guernsey-based holding company, Providence Global, was wound up, and Deloitte stepped in as administrator to wind up Providence Bonds plc.
The winding up process was completed a couple of months ago and Providence Bonds plc has now been dissolved.