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Meeting for creditors of collapsed Louis Group
A SOMBRE mood prevailed among the 50 investors in the failed Louis Group who attended a creditors’ meeting at the Villa Marina in Douglas on Monday night.
David Reynolds of the investors’ support group said most investors were not hopeful of retrieving their money.
‘This falls strictly outside the investors’ compensation scheme and I think many of the investors would not have understood the ramifications,’ he said.
‘I think we are all in a state of shock, but I am grateful personally in that I thought the meeting would say the cupboard was bare but at least it is still ongoing and some assets remain.’
However, he said it seemed the chances of any payout were slim, depending on which investments people had, with the best result being perhaps 50 per cent recovery for a few.
Mr Reynolds himself has taken a heavy hit.
‘I’m destitute,’ he said. ‘I will have to sell my house. The money I had was my pension fund. I am close to retirement and had hoped to work part-time but I will have to carry on.
‘Other people have been seriously affected – their children’s education has been scuppered, there are lots of people whose lives will be irretrievably changed for the worse as a result of this. Some of the stories are heart-breaking.’
The meeting, which is a legal requirement, was the first called by liquidators PwC who are responsible for the six companies in the Isle of Man group.
Mike Simpson of PwC said various formalities – such as voting officially to accept PWC as the liquidators – were completed.
‘It was not a heated meeting,’ he said. ‘We spoke to many of the people and they are understandably very worried about their savings.
‘We also wanted to try to give them the overall picture. It’s a complex group with a number of inter-relationships between companies and there is a large number of property syndicate companies managed or controlled by the entities that we are liquidating, so dealing with those companies – trying to realise the assets within them – is key.’
The 50-odd investors at the meeting were mainly from the Isle of Man but some had travelled here specially, and some who were unable to attend were represented by proxies.
‘It was a significant number in terms of the companies we were liquidating and it was a good proportion of the creditors of the companies,’ said Mr Simpson.
Mr Reynolds said he had heard the Louis Group collected £25m from 103 investors in the UK, Ireland and Isle of Man. ‘And within six years that has all gone with risible ease,’ he said.
The knock-on effect in the wider Isle of Man economy should not be underestimated, he added: ‘This represents a lot of money that won’t be spent in the island and won’t be creating wealth here or being taxed.’
Questions were asked in Tynwald on Wednesday about the Louis Group and David Callister MLC called for an investigation into the causes of the group’s failure.
Liquidators were appointed by the High Court in May last year.
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Weather for Isle of Man
Monday 20 May 2013
Today
Sunny spells
Temperature: 9 C to 15 C
Wind Speed: 21 mph
Wind direction: North west
Tomorrow
Sunny spells
Temperature: 8 C to 13 C
Wind Speed: 24 mph
Wind direction: North west
