As you are all aware, today Liam Collins had his 2nd bankruptcy hearing adjourned. Liam Collins had asked for an adjournment of 6 weeks to get an IVA proposal together ... the judge, very frustrated with the slowness of the bankruptcy proceedings, gave Liam Collins just 1 week - he has his next bankruptcy hearing on 22nd March. During the hearing, a number of statements from investors fully supporting the bankrupting of Liam Collins were read aloud ... and I suspect mine was one of them. Liam Collins has sent out two e-mails today, one to a group of investors who he believes may be supportive of an IVA, and the other to the group of investors who he believes/knows will not support an IVA. Both these e-mails are listed below.
On March 1st, I had the following dialogue with Liam Collins:
[ewart]: Since you have to have the information at hand now in order to be engaging an IVA practitioner, can you send me the latest C&B property spreadsheet with valuations, along with an indication of when the valuations were performed and by whom. You will see from the article I have written on my blog that on the currently IFS posted C&B property spreadsheet I have little or no faith in the current valuations. This statement is based on the fair market price that 15a Moira Street was sold for versus the valuation price on the spreadsheet - they were very different (54k vs 90k respectively)!
[Liam]: You will be sent a full proposal with all info you need and you can either vote in favour of it or against it but make no mistake about it this is the last chance to get any cash back and it will work so long as we can convince Mortgage Express but right now we need you guys onside petitioning to get MX to agree not grouping together to see us put behind bars. That may give some satisfaction to some people but it takes up to 3 years for an investigation into our company and up to 2 years after that for us to defend it. At which time the IVA would be done finished and assets sold and at that time you would also be close to knowing where we stand with regards to what we are being accused of.
And in the blog entry entitled "Liam's plea to wait for an IVA proposal" posted 13/03/2012, I threw down the gauntlet again to the partners to make available to all investors this very basic information. I got the same answer:
[Liam]: Ewart the information you are asking is exactly what will be in the IVA proposal. So once you have had a look at the proposal you will then decide whether it makes commercial sense or not right? You seem to want to end this via bankruptcy before you even get a chance to see a proposal? Am I right in thinking this?
[ewart]: This will not be good enough. You should readily have this information at hand ... if you haven't, it means you don't have a clue on the current state of the business.Today (15/03/2012), after his bankruptcy hearing, I get an e-mail from Liam Collins stating:
[Liam]: I have it all to hand in front of me as we speak. It will all be in a proposal but without you showing willing to actually sign an IVA there is a chance we will not get an adjournment next week in order to do an IVA.
[ewart]: So, e-mail it out to everyone, what are you waiting for ... it is the most basic of information that all investors need at this stage.
So far he has not done so. Until the partners supply the information requested in the "Liam's plea to wait for an IVA proposal" blog entry, the reasonable assumption is that the value in the portfolio is 0, and that it will be 0 at the end of any IVA term (largely born out in the anti-IVA e-mail texts as it happens) ... otherwise, rest assured, the figures would have been made available in a heartbeat. The partners have driven the business into the ground, and from the texts below I don't even think they have an IVA practitioner lined up (but please feel free to correct me by supplying the name & address of the IVA practitioner).
Lastly, I just want to comment on some points that Liam Collins made in the e-mail to the anti-IVA camp:
For those intent on pursuing criminal allegations an IVA will not protect us from that. You can continue to do this for as long as you wish.
This is true, but it will be at the investors own expense, and the costs would be prohibitive. If the partners had even bothered reading my "Introduction" blog entry, they would realise that there are 3 aspects to the blog's purpose - maximising return for investors, holding the partners to account for the lives that they have ruined, and protecting future investors from them and their ilk.
Properties will be rented out and all income will go to MX NOT to creditors.
Any rental monies that MX keeps to satisfy mortgage payments it is fully entitled to do - I strongly suspect that C&B have not been keeping up with them (ala 15a Moira Street). If MX keeps monies above and beyond that required to service mortgage payments, then implicitly that will be rebuilding equity in the properties too, it just means that any realisation of that equity will not materialise until the properties are subsequently sold. And the partners cannot possibly be adverse to that idea given that they requested all investors to sign 5 year PNs in 2011 with all interest frozen!
I am not unrealistic to think that we will be able to pay 100p in the pound over 5 years but we are offering that.
And this from the partners who are in default on every single PN (all 5 year PNs signed last year are NULL-and-void), and who cannot even supply the basic data on which such an absurd statement is made.
The above statement also flies in the face of this snippet in the e-mail sent by Liam Collins on Nov 1st 2011, supposedly to all investors but which I was not copied on,:
This leaves us with limited choices.
2. Go into what is called an IVA. By doing this it will protect all investors against the threat of bankruptcy but it means we have to make a repayment plan. This is a positive to those who want their cash back but a negative to those who just wish for their interest as it means interest would stop and repayment would unlikely begin before the end of 2012. The other negative of this is that to offer a realistic payment plan based on cashflow projections we would have to offer as little as 20p on the pound back and this would also take into consideration how much you invested and how much you have had back in terms of interest. So if you invested £10k and have had £1k in interest the IVA practitioner would likely only offer 20p in the pound for the £9k outstanding. The final negative is that the repayment plan should we be successful would be over 5 years minimum.
================== pro-IVA camp e-mail ==================
From: Liam Collins <email@example.com>
To: Liam Collins <firstname.lastname@example.org>
Sent: <March 15th 2012>
WRITTEN SUPPORT REQUIRED URGENTLY FROM YOU TO HELP US PROVE TO THE JUDGE AT NEXT WEEK’S HEARING THAT MANY OF OUR INVESTORS WANT THE PROPERTIES TO BE SAVED FOR THE INVESTORS IN AN IVA AND OPOSE BANKRUPTCY WHICH WILL ONLY RESULT IN ONE ACTION. MORTGAGE EXPRESS WILL SELL THEM FOR A LOSS TO GET THEM OFF THEIR BOOKS AND INVESTORS WILL GET NOTHING. WE CAN NOT LET THIS HAPPEN. PLEASE READ BELOW WITH CARE. WE NEED YOUR HELP.
I am writing to you today with an update. The bankruptcy hearing this morning was adjourned for 7 days to allow us to get some sort of IVA process going. I am sending this email to you all as you are the people who have so far not shown an interest in voting in for or against an IVA. The process now is as follows:
- We have another hearing next Thursday 22nd March where we will apply for an 'interim order', which basically holds any bankruptcy action until our practitioner has had a chance to send out the IVA proposal to all creditors and to get their votes back.
- In order to get the interim order granted we need to take evidence to next weeks hearing that we have a substantial number of creditors (i.e you) who are willing to back an IVA.
What we now need you to do is fill in the blanks on the paragraph in bold below (name and amount owed), cut and paste it and re-send it to me so we can print it off and take it with us next week. Time is of the essence so if you are still in favour of an IVA, I would appreciate it if you could treat this as urgent. If we do not get the interim order granted then I will be made bankrupt and we will not be given the chance to get an IVA off the ground.
I (name), confirm I am in favour of Liam Collins' (of the CollinsBone partnership) proposal to protect my investment via an IVA. I do not believe bankruptcy is beneficial to anybody. My investment currently stands at (amount) and I will firmly support an IVA proposal.
Alastair Macleans solicitor turned up to the hearing with a list of around 15 people who were opposing an IVA. The number we have in favour by far outweighs that but it is only any use to us if we can prove it.
We will be in touch regularly over the next week with where we are at.
Thank you so much for your continued support, its massively appreciated and we will keep battling on to try and get an IVA over the line as we strongly believe it is now the best result possible.
If you need to chat about any of the above please get in touch,
================== anti-IVA camp e-mail ==================
From: Liam Collins <email@example.com>
Date: <March 15th 2012>
To: Liam Collins firstname.lastname@example.org
I am writing to let you know that today’s court hearing was adjourned for 7 days. This is to allow us time to show evidence to the judge that we have many investors who oppose the bankruptcy. This email has only gone to the people who we believe oppose the bankruptcy.
We will be calling each of you next week so that you understand exactly the situation which I will outline below in bullet points.
1. For those intent on pursuing criminal allegations an IVA will not protect us from that. You can continue to do this for as long as you wish.
2. Bankruptcy will lead to all Mortgage Express going to LPA receivers. A trustee will NOT be appointed for the estate as MX do not allow it.
3. Properties are the only assets C&B own
4. Properties will be rented out and all income will go to MX NOT to creditors.
5. Those properties which lose tenants as a result of change of management will be boarded up, NOT advertised.
6. We do not have money in off shore accounts which will be found and split between investors
7. We do not have anything which can be sold to generate income for investors.
8. Under new bankruptcy laws as of January last year I will be permitted to live in my own personal property as will David if he is made bankrupt and a charge will be placed over the asset equivalent to the equity.
9. At present when you take into consideration restrictions and interest in my own home it has no equity at all even when taking valuations from 3 online comparable sites and a RICS survey.
10. In bankruptcy I will lose all debt to my name, I will be allowed to keep my home and live in it. I will lose houses which are not going to have any equity for at least 3-5 years and rental income is only now starting to pick up. I have made no money from our assets for over 3 years so I will not miss any rental income.
11. In bankruptcy the receivers will offer a third party of ours choice to buy the assets out for a small fee meaning someone unrelated to me would be able to buy them for a tiny amount and could then gift them back to me at a later day. YES WE DO HAVE MANY CLEVER WAYS WE COULD KEEP THESE ASSETS AND INCOME FOR OURSELVES!
It is time for you all to realise, there has never been bad intent only incompetence and as I say if you wish to pursue criminal allegations you are within your rights to do so. THE IVA IS FOR YOU ALL NOT FOR US! YOU CANNOT PUNISH US BY BANKRUPTING US. It is crazy to think you can when you look at the above points but you can punish 130 investors who have hard earned cash like yourselves tied up in this and all like yourselves would like to see some or all of this returned.
I am not unrealistic to think that we will be able to pay 100p in the pound over 5 years but we are offering that. What we are saying is this. The houses are yours, you and MX have the rental income then in 5 years sell them and whatever materialised you keep between yourselves. Or you could take the emotional irrational Ewart Tempest Georges route, bankrupt us, get nothing wipe the slate. And then what........
Please let me know if bankruptcy is the absolute route you are supporting as there is little point in being covert I will find out in 7 days anyway but at least this way we can gauge whether we have a chance. Remember even if we achieve a 75% vote we still have to get MX to agree with this which is still unlikely but we have to try. IF MX say no, we are bankrupt anyway.