Yes children it’s cartoon time.
Pension Life has produced a piece of animated propaganda on behalf of the Administrators of Park First. The cartoon features a small greying figure who is supposed to represent Finbarr O’Connell, the person leading the Smith and Williamson involvement in the Park First debacle. In order to differentiate between the real-life Finbarr O’Connell and the animated version we will call one by his full name and the other by his initials – FOC.
Why would Finbarr O’Connell choose to be represented by FOC and not speak on camera himself ? Well, the words ‘plausible deniability’ spring to mind. “It wasn’t me who said that – it was FOC”.
On 15th November, Angie at Pension Life wrote an article on Park First on behalf of “investors who had contacted her”. We think she might mean pension funds who need somebody to undermine the liquidation proposal because they are vulnerable to claims from pension holders if the Park First companies are liquidated. We particularly like the biased and misleading graphic showing that if investors support the Administrator ‘Whittaker pays £33m’, but if investors support a liquidation ‘Whittaker pays £0’. That’s a very emphatic statement which has been proven to be a lie. The latest update issued by Finnbar O’Connell has confirmed that the FCA oversees these funds. What Angie should have said was ‘Whittaker would like to pay £0’. What Whittaker likes and what he gets are likely to be two different things. See yesterday’s article here.
She goes further. She has “spent a few weeks speaking to Quantuma, Smith & Williamson, Mishcon de Reya, Park First and Paul Hastings”. So she spoke to Quantuma and then spoke to four parties who have a vested interest in opposing the liquidation, some of whom were integral parties in this investment. She says “I can see that there is a dilemma for the investors and unfortunately, not a lot of time to make up their minds about which way to vote”. There’s no dilemma here Angie. All you had to do was ask your four friends what happened to the £115m, why is it unrecoverable and why won’t you tell the truth to investors ? Surely that would have been the first thing an impartial enquirer would ask, but we couldn’t find any reference to it in the report.
Angie then says that investors “just want to understand two things:
What their investments are worth
What refunds and returns they will get”
These are two good points, but we actually believe investors want to know more than that. They also want to know:
Where has the missing money gone ?
Is there any other party, or parties, I could go after to recover any shortfall ?
We sat down for cartoon time but found very few honest answers to these key points.
We think the answer to the first point is contained in the administrators report to creditors. It states that £230m was invested and the assets are only worth around £12m. So, we presume the accounts of the companies will show that the investments are worth £12m.
Point 2 is a tough one, but the latest update from Finnbar O’Connell shows that whichever option is chosen there will be £12m in assets and £33m in cash (the allocation of which requires the approval of the FCA). Both the CVA option and the liquidation option has no automatic right to these funds. Both options are before costs. The Administrator’s costs are already astronomical and it hasn’t even been able to tell anyone where the £115m has gone.
As for point 3 the only people in a position to tell investors where the money has gone is Mr O’Connell, his team and of course Toby Whittaker, but none of them are able or willing to tell investors. I don’t know why Mr O’Connell is finding it hard to tell investors. It is a very simple question. He was appointed by Toby Whittaker so just ask him “where is the money” ?
Point 4. If creditors vote for a liquidation the liquidators would investigate and report to creditors because that is the role of a liquidator. Another element of a liquidator’s role is to seek the recovery of funds which may have been unjustly distributed, whether that be to other companies or to individuals. The important benefit of voting for a liquidation rather than a CVA is that a liquidator can instigate recovery actions against any party that it feels may have some liability to creditors. This means that a liquidator can consider ALL parties involved in the investment and take action against any of them if the liquidator feels it is likely to benefit creditors. This could include company directors, pension trustees, IFAs, solicitors, sales agents etc.
We believe that if investors vote for the CVA proposal the Administrators would be very unlikely to assist investors in pursuing any claims against the parties involved. They were appointed by the directors to protect directors’ interests. We also believe it is highly unlikely the Administrators would later approve a liquidation without investor compensation routes having been completely closed off. In cases such as this directors appoint Administrators to enable the write off of missing money, to ensure no investigation into the conduct of the directors takes place and to return newly sanitised companies back into the hands of the directors.
Investors should vote to protect their own interests. Any director who takes in £230m and turns it into £12m would not get our vote.
Getting back to cartoon time we tried to maintain our interest but found it quite hard work. It’s a bit of a gimmick. They would have been better off interviewing the parties properly so that investors could look for any body language signs which might suggest that the interviewee is not telling the truth. Perhaps that’s why it was turned into cartoon time and FOC was used instead of the real person. Somebody wrote the script for the cartoon and paid for it. It was simply a paid-for commercial on behalf of the Administrators.
We thought the choice of character for FOC was quite a good likeness to Mr O’Connell so we give them a plus for that. The over-riding message we got from cartoon time was that anyone who chooses to vote for this CVA is likely to be well and truly FOCKED.
If anyone wishes to vote for the liquidation but is unable to attend they can send another person who will vote as instructed. The necessary forms to enable this to happen are at the end of this earlier article.