COLLATERAL (UK) LIMITED - IN ADMINISTRATION (the Company)

Transcription

1 Our Ref: GC/PJH/JAH/ADM309/C144 Your Ref: TO A LL KNOWN INVESTORS AND CREDITORS 28 February 2018 When telephoning please ask for: Jessica Hodgson Direct Line: Dear Sir/Madam COLLATERAL (UK) LIMITED - IN ADMINISTRATION (the Company) I am writing to advise you that I was appointed Administrator of the Company on 28 February 2018 and enclosed with this letter is formal notice of my appointment. Please note that I am licensed to act as an insolvency practitioner by the ICAEW. As such, I am bound by the Insolvency Code of Ethics when carrying out all professional work relating to an insolvency appointment. The current position The Company is continuing to trade under my supervision, however for the timebeing, until the Company position is clarified, the Company will not be facilitating any new loans or allowing the transfer of any loan portion. I understand in the circumstances, investors and borrowers will have a number of queries with regard their loans and investments, consequently a question sheet is attached for your information, which will hopefully be able to answer these queries in the interim. Claiming as a creditor Under Insolvency Legislation, an Administrator may, depending on the circumstances of the case, decide to treat a small debt of the Company (meaning a debt not exceeding 1,000 inclusive of VAT), as having been proved, without a creditor having to submit a proof in respect of their claim. Where a dividend is anticipated and it is intended that any of the Company s debts will be treated in this way, notice will be given to the affected creditors, who will be entitled to any dividend paid in respect of their debt, without proving. In such circumstances, if there is a discrepancy or difference between the amount a creditor believes they are owed and the Company s records, or should such any creditor wish to participate in any decisions made by creditors, it will be necessary for a creditor to submit a proof regardless of this provision. The above does not preclude you from submitting a proof now if you are a creditor owed less than 1,000. Alternatively, if you do not consider that you are a creditor of the Company, please notify us and we will update our records. If you are a creditor of the Company owed more than 1,000, you will be required to submit a proof of the debt owed to you as at the date of my appointment before you can participate in the proceedings.

2 Enclosed with this letter is a form for you to provide full details of your claim which should be completed and returned to my office as soon as possible. If you believe that you hold any form of security or reservation of title, would you please forward details in writing to me as soon as possible. Creditors registered for VAT may be able to claim VAT bad debt relief in accordance with Section 36 of the Value Added Tax Act Relief is available when the debt is six months old and "written off" by the creditor entering it on his VAT refunds-for-bad-debts-account. Insolvency Practitioners have no role in administering VAT bad debt relief. Creditors who are uncertain how to claim should contact their VAT office or take professional advice. You can also find useful information for creditors online through R3, the insolvency profession s trade body at The Administrator s Proposals I am currently formulating my proposals which will be delivered as soon as is practicable, but in any event before the end of the period of eight weeks beginning with the day on which the Company entered Administration. At that time, I will be seeking approval for the basis of my remuneration as Administrator (which may include approval for any unpaid pre-administration fees and expenses) and any Category 2 disbursements, from the appropriate body of creditors and will provide information regarding my proposed fees and details of the work I anticipate undertaking in this case. A guide to the rights of creditors in this regard is available on request or can be downloaded from Information request As Administrator, I have a duty to consider the conduct of those who have been directors of the Company at any time during the last three years. I also have a duty to consider whether any civil proceedings should be taken against the directors or others for the recovery of, or contributions to, the Company's assets. Creditors are invited to provide information on any concerns regarding the way in which the Company s business has been conducted, and on potential recoveries for the estate. If you have any matters you wish to bring to my attention, please forward details to me at jh@refreshrecovery.co.uk. Your ability to opt out Creditors have the right to elect to opt out of receiving further documents about the Administration, however where you choose to opt out, please be aware that you will continue to receive documents where: The Insolvency Act requires me to deliver a document to all creditors, It is notification of change in the appointed Administrator or the Administrator s contact details, It is notification about a dividend or proposed dividend, or It is a notice which the court orders to be sent to all creditors Opting-out will not affect your entitlement to receive a dividend, in circumstances where a dividend is to be paid. Although a creditor who has opted out is entitled to participate in the making of decisions in relation to the Administration, please note that by opting out you will not be given notice of decisions being sought. In circumstances where you opt out and the Company moves into another insolvency procedure (most likely creditors voluntary liquidation), you will also be treated as having opted out of the subsequent insolvency.

3 In order to opt out of receiving further documents, please make your request in writing, signed and dated by you or (if a company) someone entitled to sign on the creditor company s behalf. You will become an opted-out creditor when the notice is received by my office. You may at any time revoke your election to opt out by a further notice in writing, sent in the same way. If there is any further information or explanation you require in the first instance please contact Jessica Hodgson on Yours faithfully For and on behalf of Collateral (UK) Limited Gordon Craig Administrator Enc Pursuant to the Insolvency Act 1986 the affairs, business and property of the Company are being managed by Gordon Craig who was appointed Administrator of the Company on 28 February 2018 and who acts as agent of the Company without personal liability.

4 COLLATERAL (UK) LIMITED IN ADMINISTRATION ( the Company ) CESSATION OF NEW LOANS AND LOAN TRANSFERS Introduction Collateral (UK) Limited has gone into Administration as of 28 February 2018 with Mr Gordon Craig being appointed as Administrator. With immediate effect the Company has suspended the facilitation of loans or the transfer of portions of loans via its website. It is important to note that this does not amount to a cessation of trading and you should note the action you should take below. Please note that your investment is safe and this is a procedural and compliance issue. Why has this happened? The Company was operating in the belief that it was authorised and regulated by the Financial Conduct Authority under interim permission. It has transpired that this is not the case and consequently the Company has ceased lending. What does this mean? For the timebeing, until the Company s position is clarified, it will not be facilitating any new loans or allowing the transfer of any loan portion. As the Company is not authorised and regulated by the Financial Conduct Authority you are not afforded the protections which are afforded to customers of entities which are so authorised and regulated. Is my money at risk? The main difference between the previous situation and the current situation is that if the Company became insolvent and you suffered any loss you would not be able to recover any of those losses through the Financial Services Compensation Scheme. It should be noted however that you have never had the ability to make a claim for losses suffered as a result of any borrower becoming insolvent and unable to repay any loan you have made. I have lent money via the Collateral platform do I need to do anything? No. Subject to the borrower continuing to make payments of interest and capital those will be returned to you in accordance with the Collateral terms and conditions. I have borrowed money via the Collateral platform do I need to do anything? You should maintain making payments in accordance with your loan agreement. If you do not then you are at risk of recovery proceedings being taken against you. I hold a portion of a loan and want to transfer that? You would not be able to facilitate this through the platform. If I am unsure what should I do? If you are unsure about your position you should take independent legal advice from a solicitor or other suitably qualified professional. What is the future for Collateral? The Directors of the Company have recently appointed new external counsel and specialist compliance consultants with regard their business model and approach. In terms of the current business model and the Company s correspondence with you:

5 a. The Company has ring fenced the existing loan book and will look to wind this down over the life of the loans in an appropriate way. b. The Company is reviewing how it might best continue the business, a number of potential routes forward have been identified but these are still being assessed.

6 In accordance with Rule 3.27 of the Insolvency (England & Wales) Rules 2016 & paragraph 46(4) of Schedule B1 to the Insolvency Act AM01 Notice of administrator s appointment For further information, please refer to our guidance at 1 Company details Company number Company name in full Collateral (UK) Limited Filling in this form Please complete in typescript or in bold black capitals. 2 Court details Court name High Court of Justice, The Business and Property Courts in Manchester Court number Administrator s name Full forename(s) Surname Gordon Craig 4 Administrator s address Building name/number c/o Refresh Recovery Limited Street West Lancashire Investment Centre, Maple View Skelmersdale Post town Lancashire County/Region Postcode Country 5 Administrator s address or telephone number address Telephone number 6 Insolvency practitioner number Insolvency practitioner number W N 8 9 T G You must give an address or telephone number. All information on this form will appear on the public record. 04/17 Version 1.0

7 AM01 Notice of administrator s appointment 7 Administrator s name 1 Full forename(s) Surname 8 Administrator s address Building name/number Street Other administrator Use this section to tell us about another administrator. Other administrator Use this section to tell us about another administrator. Post town County/Region Postcode Country 9 Administrator s address or telephone number 3 address Telephone number 10 Insolvency practitioner number Insolvency practitioner number 11 Statement of appointment Date I confirm the appointment of the administrator(s) on d d m m y y y y 12 Name of person, body or court appointing administrator Person, body or court name the Director 4 You must give an address or telephone number. All information on this form will appear on the public record. 13 Sign and date Administrator s signature Signature Signature date d d m m y y y y /17 Version 1.0

8 AM01 Notice of administrator s appointment Presenter information You do not have to give any contact information, but if you do it will help Companies House if there is a query on the form. The contact information you give will be visible to searchers of the public record.! Important information All information on this form will appear on the public record. Contact name Gordon Craig Company name Refresh Recovery Limited c/o Refresh Recovery Limited Address Where to send You may return this form to any Companies House address, however for expediency we advise you to return it to the address below: West Lancashire Investment Centre, Maple The View Registrar of Companies, Companies House, Crown Way, Cardiff, Wales, CF14 3UZ. Skelmersdale DX Cardiff. Lancashire Post town County/Region Postcode Country DX Telephone Checklist W N 8 9 T G We may return forms completed incorrectly or with information missing. Please make sure you have remembered the following: The company name and number match the information held on the public Register. You have signed and dated the form. i Further information For further information please see the guidance notes on the website at or enquiries@companieshouse.gov.uk This form is available in an alternative format. Please visit the forms page on the website at 04/17 Version 1.0

9 Proof of Debt Form Collateral (UK) Limited - In Administration 1 Creditor Name (If a company, please also state company registration number) 2 Address of creditor for correspondence 3 address for creditor 4 Total amount of claim, including VAT and outstanding uncapitalised interest Note: Any trade or other discounts (except discount for immediate or early settlement) which would have been available to the company but for the insolvency proceedings should be deducted from the above claim where relevant. Where any payment is made in relation to the claim or set-off applied after date of winding-up, this should be deducted 5 If the amount in 4 above includes outstanding uncapitalised interest, please state the amount 6 Details of any documents by reference to which the debt can be substantiated (please attach copies) 7 Particulars of how and when the debt was incurred by the Company 8 Particulars of any security held, the value of the security, and the date it was given Value = Date given / / 9 Particulars of any reservation of title claimed, in respect of goods supplied to which the claim relates 10 Signature of creditor or person authorised to act on his behalf 11 Name in BLOCK CAPITALS 12 Date 13 Position with or in relation to creditor Address of person signing (if different from 2 above)