LCF Bonds - What Assets Are Backing Their Loans?
One of the big selling points of London Capital & Finance and other companies bonds was that they were Asset Backed and that any loans made were covered by assets worth more than the loan. It appears that most investors took this at face value and trusted LCF that the assets were actually something meaningful that had a value. I suspect that most investors in LCF thought that asset backed meant that the assets were things like physical property, business assets, machinery etc. It appears that this may not be the case in all situations and many of the assets are purely paper based.
There are 12 companies that borrowed the £236 million of bond money from London Capital & Finance with one, London Oil & Gas, taking the lion's share of this with loans of £122 million.
The companies and the security that backs their loans are shown below. Make your own minds up whether you would really consider these assets to be suitable security for the £236 million that LCF took in from bonds.
The asset for the loans made to CV Resorts is 3 contracts as shown below. "Addendum to Promissory Contracts of Purchase and Sale - Paradise Beach resorts made between Paradise Beach - Aldeamento Turistico Algodoeira SA (1) and the Chargor" plus 2 variation agreements
The assets for London Oil and Gas (LOG) are the loans made to Independent Oil & Gas in 2015 and 2016. It's very unclear how these loans give security to the £122 million that LOG borrowed from London Capital & Finance as back in 2015/16 these would have been relatively small amounts of money as LCF only had total bonds of £60 million in 2017.
This company appears to have cleared their loan from LCF as charges were removed on 15 February. It's unclear how this ties up with the Administrators claim that no loans have been repaid.
Security was a floating charge over assets including 4 Subsidiaries. No fixed charge over any assets.
London Group Llp (owns London Power Mgt)
Colina Property Holdings Ltd
Subsidiary of Waterside Cornwall, "The Contract between Inversiones 51588 SRL in Dominican Republic and various individuals relating to the sale and purchase of plots of land known as el Cupey dated 7 March 2012." This is interesting as the FSCS has made a ruling about el Cupey timeshares that their value is NIL.
Colina Support Ltd
Asset is a deed of debenture granted to Colina Support by Colina Property Holdings so effectively it's giving security that has already been assigned as both companies are borrowers from LCF.
River Lodge Equestrian Ltd
All the shares in River Lodge Equestrian Limited, a company in Ireland
Costa Support Ltd
Costa Property Holdings Ltd
Prime Resort Development Ltd
Riverview Equestrian Ltd
Cape Verde Support Limited
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| LCF Bonds - Asset Backed Loans |
The companies and the security that backs their loans are shown below. Make your own minds up whether you would really consider these assets to be suitable security for the £236 million that LCF took in from bonds.
CV RESORTS LIMITED
The asset for the loans made to CV Resorts is 3 contracts as shown below. "Addendum to Promissory Contracts of Purchase and Sale - Paradise Beach resorts made between Paradise Beach - Aldeamento Turistico Algodoeira SA (1) and the Chargor" plus 2 variation agreements
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| Asset for the loans made to CV Resorts |
London Oil & Gas Ltd
The assets for London Oil and Gas (LOG) are the loans made to Independent Oil & Gas in 2015 and 2016. It's very unclear how these loans give security to the £122 million that LOG borrowed from London Capital & Finance as back in 2015/16 these would have been relatively small amounts of money as LCF only had total bonds of £60 million in 2017.
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| Assets for LCF loan to London Oil and Gas (LOG) |
LONDON POWER MANAGEMENT LIMITED
This company appears to have cleared their loan from LCF as charges were removed on 15 February. It's unclear how this ties up with the Administrators claim that no loans have been repaid.
Waterside Cornwall Group Ltd
Security was a floating charge over assets including 4 Subsidiaries. No fixed charge over any assets.
London Group Llp (owns London Power Mgt)
Colina Property Holdings Ltd
Subsidiary of Waterside Cornwall, "The Contract between Inversiones 51588 SRL in Dominican Republic and various individuals relating to the sale and purchase of plots of land known as el Cupey dated 7 March 2012." This is interesting as the FSCS has made a ruling about el Cupey timeshares that their value is NIL.
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| Inversiones 51588 SRL in Dominican Republic and various individuals relating to the sale and purchase of plots of land known as el Cupey dated 7 March 2012 |
Colina Support Ltd
Asset is a deed of debenture granted to Colina Support by Colina Property Holdings so effectively it's giving security that has already been assigned as both companies are borrowers from LCF.
River Lodge Equestrian Ltd
All the shares in River Lodge Equestrian Limited, a company in Ireland
Costa Support Ltd
Costa Property Holdings Ltd
Prime Resort Development Ltd
Riverview Equestrian Ltd
Cape Verde Support Limited
It would be helpful if you could identify all the solicitors that helped LCF set up this scam
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