Exclusive: Collapsed bond firm LCF put £70m into property firm staffed by banned directors
Two men in senior roles at a property developer which purportedly received £70 million from collapsed bond company London Capital & Finance are banned as directors, with one being a convicted fraudster.
Administrators at Smith & Williamson are attempting to recoup £236 million LCF lent to a small group of companies including Prime Resort Development.
S&W is administering both LCF and Prime. It says LCF claims to have lent £70 million to Prime. However, the properties it owns are worth as little as £10-£15 million, S&W claims. They consist of a Cornish holiday park and land in the Dominican Republic.
Prime’s senior workers include Terrence Mitchell, who was sentenced in December 2018 to two years’ jail for fraud and six months for “carrying on regulated activities” at collapsed savings scheme Anglo Wealth. The sentences were suspended for two years.
Another was Paul Seakens, who worked as Prime’s book-keeper.
He was disqualified as a director for 13 years in 2018 for his conduct at a carbon credit company. It was one of the toughest sanctions that year from the Insolvency Service, whose maximum toll is 15 years.
Sources said Mitchell had been in charge of a global effort to raise funds for Prime. He did not respond to requests to comment, and neither did Prime’s former chairman Ian Sands.
Seakens said: “I was perfectly qualified for the role I was carrying out for them,” adding that Prime would have survived if LCF’s funding had not stopped after it was shut by the Financial Conduct Authority. “Absolutely it would have had a chance of repaying the money [it owed LCF],” he said, adding: “No, I do not feel we did anything wrong.”
Seakens also acted as book-keeper for another bust bond company called Asset Life, according to that company’s administrator David Rubin & Partners. Mitchell was a director there until 2018. David Rubin & Partners said book-keeping records show Prime apparently lending money to Asset Life, while Asset Life also appears to have lent money to Prime. Seakens denied any conflict of interest as the two businesses had separate boards of directors.
LCF bondholders’ first repayment, due last month, was postponed and cut due to the impact of the coronavirus.
