THE PURPOSE OF THIS BLOG


This blog was established to help get to the bottom of how the Collins & Bone Partnership reached the very sad situation it is now in, with its partner Liam James Collins having a bankruptcy hearing on 25th January (postponed)15th March 2012 (ditto), and finally bankrupted on 9th May 2012 (case # NEWC 1517 of 2011 BKT 3472187, Newcastle County Court, The Law Courts, The Quayside, Newcastle-upon-Tyne, NE1 3LA), and David Bone Jnr declared bankrupt on 31st May (case no 100 of 2012 Wigan County Court). The partnership used the following addresses:

25 Shelton Street, Covent Garden, London, WC2 H9HW, UK

Eastern Villa, Station Rd. North, Forest Hall, Newcastle Upon Tyne, NE12 9AE (owned by Liam Collin's parents, and now up for sale)

There are 3 specific goals of this blog:

• To find out what happened to the 1m+ GBP monies that C&B raised via PNs in late 2009, 2010 & 2011. I am excluding PNs issued to ex-CBS investors, but that said, this blog will be of interest to ex-CBS investors, and there is information that needs to be obtained from this set of investors wrt when PNs were issued to them, and their duration.

• To determine what, if any, criminal charges should be brought against the partners.

• To warn other investors off doing any business with the partners, their equally inept/unscrupulous extended family members, and supportive cohorts.

When you look at the PNs, there are no specific statements on the documents that specify how the monies were to be used - how you believed they were to be used is based on whatever e-mail/phone call foreplay you had beforehand with Liam Collins. That is why it is so important that the following information is collated for this category of C&B investors on an individual basis:

1) What did you believe you were investing in, and what was your basis for believing this?
2) What investment risks were you informed of?
3) What was your understanding of the purpose to which PN monies could be put?
4) What brochures and documents were you furnished with as prt of your due diligence?
5) What due diligence did you do?
This blog is being operated completely separate to Sally & Jasmine's blog (http://collins-bone-investors.blogspot.com), although we share the common goal of getting to the bottom of this mess in a professional manner. If you don't want to post anything on the blog in person, you can send an e-mail to me at lastdoghome@gmail.com - information conveyed in any such e-mails will only be posted on the blog on your behalf after any editting/your specific consent.


Ewart (The Editor)



Monday, 27 February 2012

C&B property list & Novocastria Lettings

This particular blog entry is work in progress, and the gaps will be filled in as the information is mined.

On Wednesday 22nd Febrruary, 2012, IFS posted the article "COLLINS & BONE HOUSES AND NOVOCASTRIA LETTINGS" on their blog http://collins-bone-investors.blogspot.com, and which contained a C&B property spreadsheet. Investors by now are aware that:

  • There is preciously little equity in the C&B assets, if any.
  • The only revenue stream that C&B has is rental monies from their existing assets .... only no money is coming in. Why? More on this in a moment.
But it gets worse:
  • This spreadsheet was sent to a C&B investor in Q2 2011 by Liam Collins, yet it is already many months out-of-date as the document makes reference to mortgages "Fixed to 31/12/2010". Also of interest is the following property:
    15a Moira Street
    Mortgage balance ~98k GBP
    Valuation: 90k

The mortgage payments on this property fell behind, so the mortgage lender (it was not Mortgage Express) re-possessed the property and sold it through a local estate agent. The asking price was just under 52k (this was the going market price, not a fire-sale price), and the house sold for under 55k (there was in fact a bit of  a bidding war for the property) in November 2011. So the spreadsheet on the IFS blog is accurate up to November 2011 at best. But what is very significant is the huge disparity between C&B's valuation price and reality, so I question the accuracy of all the C&B valuations on this spreadsheet. Who valued the C&B assets, and when was this done? I have asked Liam to estimate the date of this spreadsheet.
  • I have another C&B property spreadsheet that was supplied to an earlier investor in 2008. There are 15 properties in common between the two spreadsheets. What is interesting is that the combined mortgage balances on these 15 properties increased ~200k GBP between 2008 and Nov 2011 (the best guess at this stage of the age of the IFS posted C&B property spreadsheet), yet their respective combined valuations dropped ~660k GBP. But Liam has stated that no equity has been taken out of these properties since 2008. So the only way that Liam's comment can hold true is if either:
The IFS posted C&B properties spreadsheet goes back to 2008 (in which case, why is it being sent to an investor in Q2 2011?). I checked out 16 of the 29 properties in the IFS posted C&B properties spreadsheet, and all bar one were purchased before 2008, so at least that checks out.
or
Mortgage payments fell behind on these properties, and Liam does not view such an activity as withdrawing equity, which implicitly it is. I think this is more likely, especially given that this is what happend to 15a Moira Street.
C&B assets in Loughborough are managed by Rami Hariri:
Business phone # 07896567013
Mobile phone # 07896567013
http://www.landlords-uk.org.uk/properties.asp?id=19133
And if you go to this web page and perform a search on their properties, you will see that with a few minor exceptions, all are available (i.e. not rented out). All other C&B assets are managed by Novocastria Lettings:

Novocastria Lettings
36 Langhorn Grove
Newcastle Upon Tyne
Tyne & Wear NE6 1XL

Not only is this address that of a C&B asset, it is also the address used by Novocastria Developments Ltd, a company run by Mark Black & David Bone Snr. In the absence of receiving responses to the questions below, it is reasonable to assume that Novocastria Lettings is an integral part of Novocastria Developments Ltd., esp. when their web pages all have "Copyright Novocastria Developments Limited. All Rights Reserved" at the bottom. From the spreadsheet that posted in ths aforementioned IFS article, 6 of C&Bs assets:

2 Dronfield Rd
2 Peacock Avenue
4 Albert Street
36 Langhorn Close
11 Queen Street
60 Dundonald Street

appear on Novocastria Lettings web-site. I asked Liam the following questions on 22/02/2012:

[ewart]: Sally's blog indicates that the housing assets are managed by Novocastria Lettings, and you had also indicated that some of the PN monies collected in 2010/2100 were spent on the renovations of these assets.
  • How much money was spent in each of 2010 and 2011 on these renovations?
  • In terms of the rental income from these assets, what %age came back to C&B in 2010/2011 i.e. what was Novocastria Lettings' %age cut?
  • What is the history behind the management of these lettings in 2010 & 2011?
[Liam]: I am afraid to say I cannot answer any of these questions. If I could answer these questions quickly I would not be in the mess we are in. Our accounts are held by our old accountant who will not let go of them until we have paid him in full which we cannot. Novocastria manage my properties. I get nothing at all from them ever as they are running at a loss most months.

I have asked Liam to qualify the following:
  • Are there any other C&B assets managed by Novocastria Lettings not specified above?
  • What was the basis for these 6 specific properties being managed by NovoCastria Lettings as opposed to other C&B assets?
[Liam]: Loughborough properties are managed by one person and all others are managed by Novocastria.
  • What is the agreement that C&B has in place with Novocastria Lettings wrt rental revenue generated by these properties, mortgage costs and maintenance costs?
[Liam]: Novocastria takes a management fee and organises maintenance which then comes out of the total amount sent back to the landlords which in this case is David and myself. We pay our own mortgages once the rents come in. 

At least these questions do not have a dependency on accountancy records and should be readily answerable.

I also decided to phone Novocastria Lettings. Sure enough, I get Rachael who is very surprised at my call (actually, there are two Rachael Bones which I was not aware of at the time - one is David Bone Jnr's wife (maiden name Stanley), and the other his sister):

[ewart]: I first of all wanted to find out what Novocastria Lettings is. What is it? A limited company? A partnership? What is it?

[rachael]: I don't know how you got our number to be honest. But this is something you need to speak with David about, or Liam. I just cannot help you at all." ... "I am not going to go into this" ... "can you just call David on it" ... "I don't deal with anything to do with investors".

So I fired off an e-mail on 23/2/2012 with the questions below to David Bone Jnr, Rachael (whichever Rachaels the e-mail addresses rachael@collinsandbone.com and rachaelbone@castleandgatehouse.com correspond to), Liam and info@novocastriadevelopments.co.uk. Unbelievably, neither e-mailing Novocastria Lettings from their own web-site, or info@novocastrialettings.co.uk, work!!  And the very next day Novocastria Developments web-site www.novocastriadevelopments.co.uk became a black screen (maybe that's what BS stands for when David Bone registered himself as a director of MTM North East Ltd under the name of Mr B.S David :-)). So far no responses - worst case these questions WILL get answered once the bankruptcy trustee has been appointed. one is David Bone Jnr's sister, the other his wife - I assume that I was talking with the former) .


Date: Thu, 23 Feb 2012 07:27:02 -0500

What kind of a company is Novocastria Lettings (Ltd, LLP, partnership)?
Answer:

When was Novocastria Lettings founded?
Answer:

When did Novocastria Lettings start managing the rental of C&B assets?
Answer:
What company had responsibility for managing the rental of C&B assets prior to Novocastria Lettings?
Answer:

Why is Novocastria Lettings using the address of one of these C&B assets (36 Langhorn Close, Newcastle-upon-Tyne) as its business address? Does it physically occupy these premises?
Answer:

Where does the money to renovate/manage these C&B assets come from?
Answer:

If the answer to the previous question is (in part) C&B, how much money did C&B pay the company(ies) responsible for managing the rental of C&B assets in each of 2010 and 2011?
Answer:

How much money have the company(ies) responsible for managing the rental of C&B assets paid back to C&B in each of 2010 and 2011?
Answer:

What is the value of the rental income that C&B properties have generated in each of 2010 and 2011?
Answer:
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1 comment:

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