West Wales News Review — analysis with a sustainability slant

Spending per Head on Council Services — It’s Not Enough

Which local authority in Wales spends the most, per head, on running services?

The answer is Rhondda Cynon Taf, at £2,503 per head in 2016-17 — £620 more than Monmouthshire’s £1,883, at the foot of the table.

But in the context of rising need, neither of these figures seems sufficient.

The figures are for gross revenue spending, the amounts councils spend on their operations, in contrast to capital spending on new buildings and infrastructure.

The four authorities with per head spends over £2,400 are all former coal and steel heartlands which have suffered during the years of industrial decline in Wales, and in the UK overall. Neath Port Talbot still, tenaciously, retains its steelworks, but workers there have just traded future pension income for continuing jobs today.

West Wales authorities do not feature in the top ten. Carmarthenshire is 11th, with spending per head of £2,237. Ceredigion and Pembrokeshire, 15th and 18th with £2,207 and £2,194 respectively, are rural counties where service provision is relatively expensive, there are miles of highways to maintain, and ageing populations with rising needs for social care. Carmarthenshire and Ceredigion both have over 20% of their residents aged 65 plus, and in Pembrokeshire the over-65s are almost 22% of the total population. In Rhondda Cynon Taf, though, barely over 17% are over-65s, and in Merthyr Tydfil under 17%.

The three authorities with the lowest spend per head all border England, and Monmouthshire at the bottle of the table is relatively affluent, certainly compared with the old industrial valleys, but is not exactly Kensington and Chelsea.

Perhaps the main question should be whether any of the per head spending figures are remotely adequate — and if they are not, where on earth additional resources could be found.

Authority Population Gross revenue spending £ Revenue spending per head £
Rhondda Cynon Taf 237626 594740636 2503
Merthyr Tydfil 59139 147089203 2487
Blaenau Gwent 69549 172392888 2479
Neath Port Talbot 140879 342450123 2431
Denbighshire 95144 227048068 2386
Torfaen 91799 217125719 2365
Caerphilly 180481 423500568 2347
Newport 147749 344970686 2335
Gwynedd 122605 278949310 2275
Bridgend 142038 322011255 2267
Carmarthenshire 185485 414917359 2237
Conwy 116561 260430342 2234
Swansea 243046 541221865 2227
Anglesey 70170 155129718 2211
Ceredigion 75864 167432294 2207
Cardiff 360491 794863354 2205
Powys 132303 290899698 2199
Pembrokeshire 123858 271721880 2194
Vale of Glamorgan 127985 275225417 2150
Wrexham 137929 287429837 2084
Flintshire 154372 309230624 2003
Monmouthshire 92639 174477964 1883

Population figures are for the start of 2016-17. Gross revenue spends are from the Welsh Government. 


Corran’s Tangled Web:Intentional Misrepresentation?

The strange story of some £16.7 million of lost investments in The Corran Resort and Spa, Laugharne, becomes ever more troubling. Investor Ian Dixon discovered that Kayboo, in administration since October 2016, sold 166 fractions of hotel ‘suites’ on land then owned by EHF Hospitality Ltd and which contained no hotel accommodation.

EHF Hospitality’s property at East House Farm is now with Secured Bridging Finance, the mortgagor. Secured Bridging Finance’s Alan Lister contacted West Wales News Review with the following information:

“Our company, Secured Bridging Finance Ltd (via our company’s wholly owned subsidiary company) owns Barns 3, 4, 5, 6, and 7, East House Farm. From time to time Mr Peter Burnett [director of Kayboo Ltd, East Marsh Operational Company Ltd, Pennaf Premier Group Worldwide Ltd and several other companies] enquired about purchasing our barns, but he failed to follow through.

“Our barns appear from the diagram in your article to be included in the fractional ownership scheme. We were not aware that our barns were included.

“While the five barns continue in our company’s ownership we would not have agreed, had we been asked, to their being included in any such scheme.

“We are concerned that our barns – and perhaps our company – may have been intentionally misrepresented as being under the control of the promoters of the scheme.”

EHF Hospitality’s sole current director is Matthew Roberts, who was declared bankrupt in September 2014. Companies House proposes to strike off EHF Hospitality, which has not submitted any accounts since the year to February 28th 2011. Former directors of EHF Hospitality are County West Secretarial Services Ltd (February 4th 2010 to September 23rd 2013) and Paul Manley, of Newquay, Cornwall, for a single day, February 4th 2010.

Paul Manley was, from February 29th 2016 to October 11th 2016, a director of Glendore Real Estate Ltd, which currently owns The Corran, and of the hotel operating company Plustocks Management Ltd (to October 13th). These two companies have replaced Kayboo Ltd, which owned the hotel, and East Marsh Operational Ltd, which ran it. East Marsh Operational Ltd is, like Kayboo, in administration.

Kayboo and East Marsh Operational Company director Keith Stiles remains a director of Glendore Real Estate and of Plustocks Management.

So round and round we go. Round and round.

Ian Dixon also reports that Kayboo sold 133 fractions of suites on land owned by Paul Manley, and that Malthouse Farm, the intended third phase of The Corran’s expansion, was not owned by Kayboo or by Kayboo director Peter Burnett, contrary to a statement made on the application for planning permission (which Carmarthenshire County Council rejected because of flooding and environmental risks, and which was also rejected on appeal).

Investors thought they were buying 999-year leases on land, and property on it, in many cases for their pensions.

But most of them were buying nothing at all.

The depressing story is far from finished.

SUNK – Investments Drown in Carmarthenshire Marsh

Corran Resort and Spa Investors Lose Millions

The Corran Resort and Spa at East Marsh, Laugharne, on the flat coast west of the Taf estuary and immediately north of the seven-mile long Pendine Sands in Carmarthenshire, is at the centre of an angry campaign by investors whose individual losses range from about £17,000 to  well over £100,000, and total just on £16.7 million.

Investors’ losses include pension savings, highlighting the dangers of the UK’s new liberalised regime which allows people wide freedom to invest or spend their pension funds as they like.

Rooms at The Corran –  ‘suites’ in marketing parlance – were sold to 416 investors, many of whom purchased fractions of a suite, as little as one-twentysixth for £17,000 or £18,000, depending on the seller.

The hotel was owned by a company called Kayboo Ltd and operated by sister company East Marsh Operational Company Ltd. Both went into administration on October 18th 2016, although the official date for the appointment of administrators was a couple of weeks later on November 3rd.  Investor Ravinder Singh’s claim on East Marsh Operational for about £2,500 in unpaid rent was the first falling domino which led directors Peter Burnett and Keith Stiles to put the companies into administration. “They used it as an excuse for the ‘Notice of Intention’ that they filed and to ‘blame’ me for the companies going into liquidation,” he said. “I am one of the leaders of a group of investors who are seeking a return of our investment and hopefully justice served on the perpetrators of this fiasco.”


The Corran Resort and Spa. Photo from marketing promotion

Kayboo’s latest published accounts, for the year to March 31st 2015, show fixed assets – land, property, machinery, furniture – of £14.5 million. Debts to be paid in the following year were £1.572 million, and debts repayable after that, £14.167 million. The company’s share capital was only £1, but a ‘revaluation reserve’ of £1.264 million padded out the balance sheet, and shareholders’ funds were reported as £861,000, more than double the previous year.  In the following months, investors’ funds continued to flow in.

Eighteen months later, Kayboo was apparently so poor that the administrator thought it a good idea to sell the hotel for £150,000 in a pre-pack deal to Keith Stiles, one of its directors, so that it could remain open and continue employing staff. The deal was completed on October 18th 2016. Pre-pack deals are legal although apt to anger investors who have lost their money.


The Corran from the air: marshland getaway. Photo from marketing promotion

Investors bought room fractions through intermediaries such as Barrasford and Bird of Tavistock, Devon, and pensions specialist Rowanmoor of Salisbury, Wiltshire, which enabled individuals to put Corran investments into their self-invested personal pensions.


Missing Leases

Investors thought they were buying leases, and started to do so in 2012, before the hotel reopened under new Kayboo ownership in 2013, after closure in a previous period of administration. Yet by November 2016 only three leases had been completed, according to Stuart P Kelly, joint administrator alongside Stephen Clark, both of HBG Corporate Ltd, a small firm of insolvency practitioners in Tarleton, Preston. Mr Kelly revealed this while chairing a creditors’ meeting on November 30th in the Angel Hotel, Castle Street, Cardiff.

Why only three completed leases, plus five executed but not completed? The leases should have been held in the fractional ownership companies set up for the purpose, but chartered accountant David Bates, a director of The Fractional Ownership Consultancy and of the numerous companies set up to hold the leases, told the creditors’ meeting that although he had signed many and returned them to Kayboo Ltd and East Marsh Operational Company Ltd,  he did not know what was registered or counter-signed.

This prompted one of the investors present to comment that all the investors who had paid to belong to Kayboo Ltd have “no property interest, no interest in anything at all, all they have is membership of  a company with no assets”.

Where are the other leases? The administrators did not seem to know.

This is among the many issues which Oliver Jackson, a partner in Freeths Solicitors representing investors, has raised with the administrators.


Some Significant Names in The Corran Story

David BATES Chartered accountant, director of The Fractional Ownership Consultancy and a large number of fractional ownership companies, based in Heswall, Wirral. Agreed with the administrators, HBG Corporate Ltd, to stop investors adjourning the creditors’ meeting on November 30th 2016 to allow them time to present documentary evidence contradicting information presented by the administrators.

Jamie BROWN Developer of property in Portugal arrested near Cross Hands in December 2011 for possession of cocaine and unlicensed guns and ammunition at Hurst House Hotel, now The Corran Resort, and in 2012 sentenced to five years in prison.

Peter BURNETT  (55) Director of Kayboo Ltd, East Marsh Operational Ltd and several other companies including Pennaf Premier Group Worldwide Ltd. Contact address is in Port Talbot. Pennaf Premier Marketing (director Stephen Paul Turner, dissolved August 16th 2016) provided The Corran Resort & Spa’s website, http://www.corran.com.

Jeremy (Jerry) COBB  Former director of The Fractional Ownership Consultancy Ltd, and based in Sotogrande on the Costa del Sol, Spain.

EAST MARSH OPERATIONAL Company Ltd Set up on February 22nd 2012 to operate The Corran on behalf of Kayboo. Put into administration on October 18th 2016.

The FRACTIONAL OWNERSHIP CONSULTANCY  was incorporated on October 12th 2005 by company secretary Marlborough Secretaries Ltd of Farnley House, La Charroterie, St Peter Port, Guernsey, for agents Marlborough Trust Company Ltd of the same Guernsey address.

Oliver JACKSON Partner in solicitors Freeths, representing investors who have lost money.

KAYBOO Ltd Company which entered administration on October 18th 2016, set up on October 4th 2010 to own The Corran Resort and Spa. The early directors were Aderyn Hurworth, appointed at the date of incorporation and resigned October 15th 2010, and Charlotte Thornley (sometimes written Thornlky at Companies House) Acourt Dutton, appointed October 19th 2010 and resigned November 28th 2012. Charlotte is also a company director under the surname Roberts – she is married to Matt Roberts (see below).

These directors were succeeded by Keith Michael Stiles (August 1st 2012), County West Secretarial Services (August 20th 2012), and Peter William Burnett (January 11th 2013). There are connections between the old and new regimes, for example Charlotte Thornley Acourt Dutton, Keith Stiles, Paul Manley and County West Secretarial services were all at different times directors of Golden Oriental Catering Ltd, incorporated on June 26th 2002 and dissolved on December 9th 2014.

Stuart KELLY  Administrator of Kayboo Ltd and East Marsh Operational Company Ltd, jointly with Stephen Clark, both of HBG Corporate Ltd, insolvency practitioners of Tarleton, Preston in Lancashire.

Paul MANLEY (61) Director of Glendore Real Estate Ltd and Plustocks Management Ltd, the companies which have replaced Kayboo Ltd and East Marsh Operational Company Ltd.  Address listed is in Newquay, Cornwall.

Les MILTON Former director of The Fractional Ownership Consultancy Ltd, based near Jeremy Cobb in Sotogrande, Spain.

Neil MORRISSEY  Actor and singer Neil Morrissey, a star of the 1990s TV sitcom Men Behaving Badly, and subsequently the voice of Bob the Builder. He bought Hurst House Hotel in 2001 but failed to make it pay. In its final year of trading under his ownership, the venture lost over £1.375 million. Administrators from the accountancy firm PwC sold Hurst House Hotel to Neil Morrissey’s business partner Matt Roberts in a ‘pre-pack’ deal which enabled the business to keep operating.

Matthew (Matt) ROBERTS Former business partner of Neil Morrissey in Hurst House Hotel. Bankrupt in September 2014. His wife Charlotte (see under Kayboo, above) runs a fractional investment scheme for an eco-village, the Convent in the Hills, in Norway and also runs The Convent, a hotel in South Woodchester, Gloucestershire, which is being developed with the assistance of crowdfunding.

Ravinder SINGH  Investor in The Corran whose Zenith Consultancy is owed about £2,500 in unpaid rent. Mr Singh is allied to a group of investors who refused to accept Kayboo’s initial proposal, in July 2016, to rescind the obligation to provide investors with leases, and instead to issue non-voting shares in the project. These shares would receive 76% of any profits for a defined number of years but lack any element of ownership. Kayboo cited Mr Singh’s claim as the reason why Kayboo and East Marsh Operational had to go into administration.

Keith STILES (57) Chartered quantity surveyor, director of the two companies in administration and of the two replacement companies, Glendore Real Estate Ltd and Plustocks Management Ltd. Mr Stiles is a director of nearly a dozen other companies. Correspondence address is in Bedfordshire near Whipsnade Zoo.


Sales Hype

Rooms in The Corran Resort and Spa were sold to investors, through intermediaries, on the promise of 999-year leases. Property firms selling space in The Corran  in 2016 included Emerging Developments SL of Marbella, Spain, which offered one twenty-sixth of a boutique suite for £18,000 (valuing the full suite pro-rata at £468,000), and promoted the enticing potential returns from one package as 10% annually for ten years, 12% for the following five years, repurchase at 125% of the sale price in years five to 14, and at 150% in year 15.

The Villa Company was another property investment firm selling fractions of rooms in The Corran, from £18,000 and with returns up to 12%. “Invest with just £18,000 and receive on average £2,300 per year,” says an advert. “After 15 years the developer will buy back the property. Speak to one of our advisors now to learn more or book a viewing trip to The Corran.”

Neither Emerging Developments nor The Villa Company is currently offering investments in The Corran, but Solo Property Investments Ltd of London N4 – Finsbury Park – was still (January 11th 2017) advertising the “opportunity” in these glowing terms:

“An incredible UK property opportunity in a glorious rural setting with luxury suites and facilities to match, including a spa and fine dining restaurant, it’s no wonder The Corran’s success has resulted in profits for owners”. Incredible indeed.

Promoting fixed returns of up to 12% a year, and assured resale of up to 150% of the original capital investment, the marketing message emphasizes “the safety of an operating hotel and a deal almost unrivalled in today’s UK property market”.

In January 2017 Global Property Investors of London SW11 – Battersea — was another firm still inviting investments in The Corran, from £17,000.

The returns offered seemed excessive to West Wales News Review, which reported on the scheme here and here. In addition, the investments are unregulated and so should be made only by people who can afford to lose everything they have put in.


Buying Non-Existent Property?

In March 2013 the local planning authority, Carmarthenshire County Council, gave Kayboo permission to convert East House Farm, less than a mile away from the main hotel and bordering the dunes of Laugharne Burrows, into hotel rooms. This scheme was marketed as ‘phase 2’ but has not been completed.

A further phase, at Malthouse Farm less than 400 yards or so from the hotel hub, was rejected on appeal in October 2014, after the planning authority had turned it down because of possible flooding and risks to wildlife. An ambitious scheme for 200 holiday lodges, also on the marsh, failed to secure permission in December 2015, for similar reasons.

Far from having 77 suites and 200 lodges, as per the master plan, The Corran has 21 rooms, according to its website. Yet the fractional ownership companies should contain leases for which investors have paid in excess of £19 million, as recorded on documents available at Companies House. No investors with their wits about them are going to pay around £900,000 for a single hotel room, even if it is called a ‘suite’.


Where Did the Money Go?

Investors paid in £19.210 million, Kayboo reported in July 2016.

It had all gone by then. Kayboo’s expenditure analysis lists heavy costs, including.

  • Site acquisition cost over £3.641 million
  • Developer finance took £2.184 million
  • Commission and fees to sales agents exceeded £4.910 million
  • Subsidising the hotel operating company £2 million
  • Constructing a spa £850,000
  • Initial refurbishment of the existing hotel £650,000
  • Other construction work at the hotel £179,000
  • Preparation for the second phase, which would have 28 rooms, £640,000
  • Payments to the design team and planning costs £515,000
  • Legal fees and charges £400,000
  • Pennaf management and marketing (Pennaf did the website) £380,000
  • Marketing and promotional events £150,000
  • Payments to The Fractional Ownership Consultancy £120,250
  • Repayment to Lloyds Bank £70,000

Investors got some of their money back, £2.52 million classed as rental payments – but as they are deducted from the amounts investors paid in, they do not at all appear to be derived from sums paid by visitors to the hotel.

The money was exhausted before the 28 rooms in Phase 2 were completed, although investments in these rooms were sold.

As for Phase 3, after 200 holiday lodges were refused planning permission in December 2015, Kayboo floated a smaller scheme for 41 lodges in summer 2016, but did not apply for planning permission before going into administration.

The rapid exhaustion of investors’ funds, in what seems to be a speculative crowd-funding project, suggests wildly over-optimistic costings in the first place, or fatally weak cost control, or irresponsible advertising, and quite possibly all three.

Hotel suppliers are out of pocket, too.

They are creditors of East Marsh Operational Company Ltd, which ran the hotel for Kayboo and shares Keith Stiles and Peter Burnett as directors. Creditors include Thomsons Laundry of Haverfordwest, owed £29,099; Castell Howell Foods Ltd of Cross Hands, £16,317; and the butchers Eynon’s of St Clears Ltd, £10,079.

Huw Eynon of Eynon’s butchers had the impression that the hotel was doing well, and in one month had revenue of £200,000. For some reason, East Marsh Operational Company was saddled with obligations for rent payments to investors, when investors themselves are convinced their ‘agreements’ are with Kayboo. They tried, at the creditors’ meeting in November, to persuade administrator Stuart Kelly to adjourn the meeting to allow investors time to gather proof of this, but he refused. He had enough votes from David Bates, of The Fractional Ownership Consultancy, to push ahead regardless of investors’ wishes.

“The requested adjournment would have allowed time to investigate which company was responsible for about £3.5 million in outstanding dividends,” said Mr Eynon afterwards.

He continues to supply the hotel with meat, and says the payment arrangements are now very different. “It is cash on delivery,” he said. “Under Kayboo, the management at the hotel did not deal with payments, they just logged income.” He thought that one of the directors had dealt, or did not deal, with payments to suppliers.

Now that Keith Stiles has obtained the hotel for £150,000, through Glendore Real Estate Ltd, he can in future sell it on for whatever the market will pay, because there is no limit clause in his purchase agreement. This was a bone of contention at the creditors’ meeting.  Robert Dymond of insolvency practitioners Wilson Field, representing investors, said that “regardless of the outcome of today’s meetings and whether the administrators’ proposals going forward are accepted, modified or rejected, it is likely that the investors will want to challenge and overturn this sale.”


Kayboo’s Offers

Before a creditor’s claim forced Kayboo into administration, in summer 2016 the company proposed ending the obligation to provide investors with leases, and replacing it with the issue of non-voting shares in the project which would share 76% of any profits. If all went well, investors would receive their capital back in 2023. The directors would receive 26% of profits plus salaries, too. To judge from recent history the chances of the hotel, in six years to 2023, generating profits for investors totalling around £11.5 million — based on an annual return of 10% —  would be in my opinion akin to winning the mega jackpot in the Euro Millions lottery.  Investors made their displeasure known.

Kayboo then made another offer, to distribute 80% of profits to investors over a longer time frame, until 2031. The directors would receive 20% of profits, as well as their salaries. This deal still had no certainty, and no property ownership, other than the intention to repay original investments in 2031. Despite exhortations from sales agents Barrasford & Bird to accept the offer, because in their view it offered a better chance of funds recovery than if administrators took over, investors remained  unconvinced.

Kayboo and sister company East Marsh Operational Company duly went into administration.


Angry Creditors’ Meeting

Creditors’ meeting chair Stuart Kelly closed it down “to avoid any unrest” because the attendees were becoming angry.  Investors felt they were being railroaded into agreeing to the rushed deal which the administrators made with Keith Stiles, and were also denied votes, because at the date of administration – October 18th 2016 – they had not attempted to withdraw their money from the fractional ownership companies where the funds should have been invested, and therefore were not classed as ‘creditors’.

Of course, at that date, investors by and large had no idea that their money had disappeared into a series of massive payments to others. Investors wanted to adjourn the meeting to allow them time to make alternative proposals, but chartered accountant David Bates, representing The Fractional Ownership Consultancy, a force behind schemes to sell bits of hotel rooms, student rooms, parking spaces and so on, and a designer of the fractional ownership companies, was marching in time with Mr Kelly.

David Bates claims that Kayboo owes The Fractional Ownership Consultancy £164,394.67 in unpaid fees. Mr Kelly allowed all of this to count in the voting, but investors’ claims were cut to a nominal £1 each – meaning that although the investors have lost millions of £s, they were outvoted by Mr Bates’ Fractional Ownership Consultancy.

“Where did the money go,” investor Andrew Elder asked Stuart Kelly. “How can you sell the hotel back to the same crooks without knowing?”

Mr Kelly did not appear to regard the money trail as urgent. He told Mr Elder that the investigations part of the administration process was currently at a stage of infancy, but that as part of the administrators’ duties, there would be a thorough investigation into the companies – Kayboo and sister outfit East Marsh Operational Company — and where the funds had gone. “However,” he added, “I must reiterate, if that sale was not completed the hotel would have closed.”

Investor Jeff Matthews said he knew at least two investors who would have paid £200,000 plus for the hotel, but Mr Kelly claimed to be unaware of any interest from a second party. Mr Matthews continued: “I have met with Keith Stiles, and he claimed that the hotel is worth a lot more than £150,000. Is it possible that the sale could be unravelled?”

“It is possible,” replied Mr Kelly, “but it is a matter for the court”.

Mr Kelly told the seething creditors that the operational company, East Marsh, was losing cash because sales revenue was insufficient to cover its expenditure. East Marsh was being financially supported by Kayboo, he said.

“I do appreciate all of the concerns and a full investigation will be conducted,” he added.

An angry investor criticised the administrators for failing to tell investors what was going on. “You just sat in your office and didn’t have a problem with that,” he complained. “Who’s paying your fees? Inside job?”

Mr Kelly refuted the accusation with a single word. “No”, he said.

Meanwhile, the 416 investors have set up two closed Facebook groups to share experiences and co-ordinate action. The Corran Investors Initiative has 322 members, and The Corran Equitable Society has 224.


The Fractional Ownership Consultancy and its Associates

Chartered accountant David Bates, of Heswall in the Wirral, Merseyside, is at the heart of The Fractional Ownership Consultancy. He has dozens of directorships of fractional ownership companies, including those set up for The Corran. In The Fractional Ownership Consultancy, Mr Bates’ fellow directors included, in the past, Jeremy James Cobb, of Floresta, Sotogrande on the Costa del Sol, Spain, and Les Milton, also of Sotogrande. Jeremy Cobb is reported by the information service ZoomInfo to have represented the Marlborough Trust Company Ltd, which with Les Milton initiated The Fractional Ownership Consultancy.

According to the Guernsey Chamber of Commerce, it was a developer in Portugal who asked the founders of The Fractional Ownership Consultancy to construct a legal mechanism which would facilitate the sale of fractions of property on resorts.

Coincidentally, Portugal property developer and cocaine addict James ‘Jamie’ Brown, jailed in 2012, was arrested late in 2011 for possession of a cache of cocaine and illegal handguns when a guest at Hurst House, as the hotel was called before it became The Corran in 2013.

The FOC’s current directors are David Leslie Bates, Julia Rachel Day, Lucy Ann Whitfield, and SMD Secretaries Ltd. Jeremy James Cobb was a director from January 31st 2006 to October 1st 2010, and Les Milton for exactly the same span of time.  Both became directors four or so months after the founder directors, Marlborough Nominees Ltd, Marlborough Trust Company Ltd and Marlborough Secretaries Ltd, all of St Peter Port, the capital of tax haven Guernsey.

The Guernsey Chamber of Commerce had a link to The FOC’s website, but that appears to have disappeared.

The Chamber of Commerce says: “The Fractional Ownership Consultancy Limited provides developers of worldwide holiday property with legal structuring, administration and consumer finance solutions enabling them to offer fractional ownership as part of their marketing mix.

“Over 12 years ago the individuals comprising FOC were asked by a developer in Portugal to construct a legal mechanism which would facilitate the sale of fractional product on their resorts. After years of successful operation and refinement it was decided that the product, and most importantly the back office systems which make it all work, were robust and ready to be rolled out to other developers and territories.

“They have since successfully implemented fractional ownership on a number of developments in Portugal, Spain, Greece, the UK, Turkey, Florida, Cyprus and Cape Verde.

“FOC now have over 10,000 fractions under management and have just launched OysterShare – a direct and equitable alternative to traditional shared property ownership, usage and holiday experience models.”

Two former directors of FOC, Nicholas Robert Hannah (January 31st 2006 to October 31st 2013) and Adrian Bradley Howe (May 15th 2009 to October 1st 2010) have fallen foul of the Guernsey Financial Services Commission, which on November 21st 2016 barred them from holding directorships for five years and fined them each £35,000 – and if they had been better off, it would have been £50,000. The censure was for management negligence and making false statements, in their capacity as directors of Marlborough Trust Company Ltd, another former ‘director’ of FOC.

The Marlborough Trust Company, fined £100,000 by the Guernsey Financial Services Commission, is implicated in the 2009 failure of Arch Cru, a group of funds which invested £400 million on behalf of around 20,000 private investors. Marlborough Trust Company was, it appears, ultimately responsible for investment decisions over the assets underlying 23 of the Arch Cru funds held in SPVs – special purpose vehicles – for property, wine, and a company owning other companies which invested in ships.

So the management of Marlborough Trust Company was inadequate. Could this weakness extend to its involvement in the Fractional Ownership Consultancy?

FOC’s David Bates appeared keen to keep his companies’ involvement at arm’s length. He said that investors’ contracts were with Kayboo, not FOC.

The contracts were mainly for non-existent assets, though, while their investments had sunk into the marshland.

Administrator Stuart Kelly said he would engage a firm of forensic accountants to prepare a report on the fate of investors’ moneys, and the report would be presented to the Financial Conduct Authority. This week (January 23rd 2017) a spokesman for Stuart Kelly refused to say whether forensic accountants had been engaged, because the whole matter was completely confidential.


Troubled History

The Corran location has a colourful past. The Corran name dates from 2013: before that, it was Hurst House on the Marsh, and prior to that, just Hurst House, a grade II listed small Georgian house built in 1797, with outbuildings.

The actor/singer Neil Morrissey, a star of the 1990s TV sitcom Men Behaving Badly, and subsequently the voice of Bob the Builder, bought Hurst House Hotel in 2001 but failed to make it pay. In its final year of trading under his ownership, the venture lost over £1.375 million. In 2004 he had purchased Brown’s Hotel in Laugharne town, but that did not succeed either.

Administrators from the accountancy firm PwC sold Hurst House in 2008 to Neil Morrissey’s business partner Matt Roberts in a virtually identical move to HBG’s with Keith Stiles late in 2016, a ‘pre-pack’ deal which enables the business to keep operating.

Matt Roberts and his company Followset did not stay afloat long. Two years on, in 2010, Hurst House owner Followset was in administration, this time with Grant Thornton.  Kayboo was set up the same year, and East Marsh Operational Company two years later in 2012.

The disappointing commercial history of Hurst House may reduce the number of lenders and investors willing to fund its growth in future, but on the other hand, big investors know how to protect themselves.

Many of those who thought they were buying  part of a hotel room at The Corran were not professionals but individuals, including pension savers and pension pot investors, attracted by the enticing advertising.

Current English and Welsh law relating to property investments fails to protect them against incompetent or reckless business practice at best, wilful misrepresentation at worst.



‘Slow Down’ Plea from Porthyrhyd

Porthyrhyd — in this case the country village north of Llanwrda, not the Porthyrhyd near Cross Hands — suffers from excessive speed as traffic taking a short cut from the A482 to Llandovery whizzes through without the hindrance of any limits.

Siloh, on the same route, also has no speed restriction.

This could change in 2017-18, thanks to pressure from local people, led by county councillor Dafydd Tomos and community councillor Arwel Davies. Monday (January 23) served up a lunchtime surprise to John McEvoy, road safety and traffic manager with Carmarthenshire County Council, when he arrived to meet Dafydd Tomos.

Mr McEvoy found himself facing some two dozen residents of Porthyrhyd and Siloh assembled in the Beudy belonging to Dr Brinley and Mrs Stephanie Jones, Drovers Farm, prepared to state their case strongly. Mr McEvoy had good news, though — he agreed that a 30 mph speed limit is necessary, and said he hoped it would be in place before April 2018. He also promised to visit Siloh and look at the need for speed restriction there.

Heavy vehicles, and delivery vans rushing from drop to drop, are an important part of the traffic problems on minor roads, which generally lack pavements and so are shared with walkers. The closure of local services like schools, shops and post offices, and the scarcity of public transport, means that more people have to travel by private vehicle.

If just the financial costs of transport — let alone the road safety and environmental dangers — were included in calculations, the closure of public amenities in rural areas would make a lot less sense.


John McEvoy, road safety and traffic manager with Carmarthenshire County Council, tells Porthyrhyd  residents that speed limits should be introduced in the coming financial year


Dafydd Tomos, the Plaid Cymru county councillor for Cilycwm, who backs the campaign for speed limits 


Arwel Davies, Cilycwm community councillor, who pressed for the meeting



Residents of Porthyrhyd and Siloh in the Beudy at Drovers Farm on Monday (January 23) to press for 30 mph speed limits through both villages. Dr Brinley Jones of Drovers Farm is left in the second row 

Objections Blown Away on the Wind

Perspective on wind turbines from John of Pencader, Carmarthenshire, written in 2015 but just as relevant today. The turbine of which he writes received planning permission from Carmarthenshire County Council in January 2015. An attempt to have this reversed in the High Court failed in August 2015 when Mr Justice Cranston backed the permission.

The pros and cons of windpower are not straightforward at all…

“I am writing this letter regarding the acceptance and approval of more and more single wind turbine planning applications by Carmarthenshire County Council and my particular concerns about the ‘Wern’ turbine near my home at Pencader.

“My own ‘green’ credentials are deep and fundamental to our move to Blaencwm over 40 years ago. Inspired by E.F. Schumacher’s book, ‘Small is Beautiful’, I sold our town house in Brighton, Sussex, sold our car, resigned from a secure, well-paid job in telecommunications and borrowed money from relatives to buy a collapsing long-cottage and 8½ acres of Wales. This was to care for a small piece of the planet for its nature and wildlife, to grow our own food and reduce our impact on the earth’s resources.

“Why then would I not support a ‘green and clean’ source of alternative energy like a wind turbine? Like the vast majority of the population there was a time when I too briefly thought that they were probably a good idea. A few glimpses of clusters of huge swinging blades spied briefly in wild, empty landscapes while on holiday or a car journey permit the acceptance of them as rational and much needed technical solutions to the energy crisis. However, living in Pencader where the residents’ only local recreational upland spaces are being smothered with gigantic turbines, one begins to learn more about their adverse impact, especially on people. These people, by definition are in a tiny minority and yet, from the moment that they discover that they have been picked upon to have everything they value and appreciate about their environment destroyed for ever, they find themselves even more isolated and misunderstood. They feel lonely, abandoned and persecuted, but are generally regarded as stupid, self-interested ‘NIMBYs’.

“With a career background in electrical engineering and a lifelong interest in physics it didn’t take me long to realise that the attempt to catch the energy floating on the wind was not rational or reasonable, even disregarding the harmful effects on the environment, its ecology and human beings. Learning that someone is proposing to put up a large turbine in a small field close to your own house and land, accelerates massively the learning curve that confirms all your doubts and fears.

“Another book, John Etherington’s ‘The Wind Farm Scam’ has an obviously contentious title, but is an honest and balanced analysis of the problems of seeking wind energy to power the national grid. Dr Etherington is an ecologist, and although in Chapter 6 he covers the way in which we are squandering the other irreplaceable capital to which Schumacher refers, the ‘tolerance margins’ of nature, his book provides information on the science, engineering and to some degree the politics and financing of wind turbines.

“Without the understanding that reading a book like this brings, the vast majority will assume the validity of wind turbines on the sort of basis that, ‘well, the experts and the leaders must know what they are doing so they must be alright’. Our experience of the planning process for the Wern turbine has opened our eyes to another vast layer of complicity, duplicity, connivance and manipulation, all of being essential to perpetuate this delusion if a wind turbine is ever to be built. It is easy to tell a convincing story if you can say what you like, but a different matter if you want to be honest and truthful.

“The application documents contain dozens of ‘desktop surveys’ prepared using specialist template software from online databases by people with qualifications in the relevant field. They may also have actually come here, often from England to spend a few hours driving about taking unflattering photographs and recording some details to help their report look more convincing. Self evidently, because all these surveys are all commissioned by the applicant they are inevitably skewed to present all information in a form favourable to the application, — otherwise they wouldn’t get paid.

“This can be achieved by omissions, either deliberate, or caused by the briefness or superficiality of their investigations. The ecology survey to detect bats is a glaring example in this application where the failure to meet the Natural England recommended distance from hedgerows by 50% is deliberately obfuscated.

Reasons to oppose the Wern turbine

“The 3 fields now called ‘land at Wern’ were subject to opportunistic acquisition in which a high price was paid denying the land from any of the adjacent farmers who were outbid. The owner was in collusion with a director of Seren Energy who lives near him about 5 miles away. So this proposal is purely commercial with no involvement of, or benefits to anyone who is affected adversely by it. This means that it is the antithesis of government on-shore wind energy policy which seeks community involvement and support and benefits to those affected.

“The developers were aggressively indifferent to the small group of rural neighbours who are being seriously affected by the proposal. Strongly supported by Welsh Planning law and the County Planning Authority the applications are virtually kept secret. The system assumes that no-one affected will find out about it, or if they do, be able to do anything about it. Many residents in the Welsh hills have disabilities, health and transport problems and do not have IT or good literacy skills. Because of this, the system does not expect to have to deal with valid objections and does not tolerate them. In our case a few residents had literacy, professional skills and qualifications and the vital internet access which enabled them to examine, analyse and interpret the claims in the documentation against their own knowledge and understanding of this location and its environment.

“This has resulted in an even more unbalanced and dismissive treatment of the critical issues that make this development totally unacceptable that have been raised repeatedly by, amongst many others, a retired Planning Inspector and two Environmental Health officers.

“It is this background story that makes this development (I believe) exceptional. The irrational and unreasonable behaviour of the Council in approving turbine after turbine across Carmarthenshire is creating a high level of opposition from the wider public. It is an abnegation of democratic principles and an assault on the Welsh heritage, landscape and the people who love and care about it.

“I hope and believe that the Wern turbine story could be a tipping point for Carmarthenshire County Council, resulting in greater awareness of the balance of issues for and against wind energy projects and higher standards in their treatment of the Welsh countryside and the people who live in it, who they are paid to support and protect.

Grounds for objections

“This turbine may have been instigated by two ‘local’ people, but its commercially exploitative methodology exposes all of Carmarthenshire to similar developments from agencies and investors who have no thoughts of Wales other than to abuse it for their own gain.

“The Council have duties and responsibilities of care for elderly people, for their health, mobility and physical and mental wellbeing. The pursuit of this application has already caused high levels of anxiety, depression, distress, anger and fear for at least three couples in their later years – 60s and 70s. We all have health issues. My wife had several emergency admissions to hospital in 2013.

“The erection of the turbine close to these homes will dramatically worsen their situation from the noise, visual intrusiveness and the way it would always represent the abuse of their rights and values for the remainder of their lives. The reduction in the market value their properties will certainly harm their chances of selling when the time comes for them to move into care homes or to a less demanding residential environment.

Local amenity

“The Pencader district is poor, and deficient in amenities. Its only asset is its surrounding countryside. It has no public or commercial amenity areas such as a village green, parks, gardens or parking areas. It lacks pavements along the main road, and has just had some rural grant funding turned down by the Council for an extension to its pavements in favour of Whitland. Very few footpaths (Rights of Way) in the area are usable or even open for use.

“The B4459 right through the village carries heavy traffic especially in commuting hours. The lane leaving the village to the west through the historic part known as Pentre Draw, past the Hen Gapel, over Nant Gwen, past the Pencader Castle, old primary school, and St Mary’s church represents the only direction in which residents can go to escape the creeping urbanisation, enjoy the peace and views of the countryside. As they climb the hill the view is dominated by the 10 Altwalis turbines, with another 28 to be added shortly. To have another large turbine confronting them at the top of the hill would be an insult.

“Not enough people take enough exercise these days, but the three lanes that meet at this point are used by Pencader residents walking their dogs, by visitors, riders from the kennels and half a dozen other properties, a local fitness club for jogging, tractor runs, pony carting etc. This is a vital amenity which incurs no special expenditure by the Council (and receives little maintenance) but to which this turbine would a significant detriment.”



Welcome to the Patch Work Farm

The innovative Black Mountain Food Hub, initiated by Sara Tommerup and James Scrivens, is inviting gardeners and growers in the Tywi Valley to form a ‘patch work farm’, in which individuals grow one or two types of organic vegetables for the Hub’s vegetable box scheme.

If you are interested in taking part, go to the Station Hub at Llandeilo Station at 10am on Saturday February 4th. The wooden hub building is on the left as you approach the station by road.

Sara and James are looking initially for tomatoes, peppers, chillies, artichokes, aubergines, garlic, head cabbages, sweetcorn and soft fruits — from gardens large and small.

“Running the Food Hub has shown us that there is a need for more local good quality organic veg production, but in the current climate of high land prices, flood risk and lack of professional growing skills in the area, a patch work farm is much more plausible,” they say.

Currently, subscribers to the Black Mountain veg box scheme receive produce from Ed Revill on the Gower Peninsula. The vegetables he sends arrive in Llandeilo via train on the Heart of Wales line — now carrying goods as well as passengers.

Eventually, Sara and James hope that Tywi Valley growers will be able to supply a full range of organic vegetables for local customers.


Sara and James: starting a patch work farm 


Christmas Holiday

Wishing everyone a happy Christmas and New Year.

West Wales News Review will be taking a break until January. Thank you to everyone who has read posts and commented during 2016.

The Dangerous Power of Stories

Elections for county councillors are coming up.  On May 4th 2017 we will be off to the polling stations once again, to choose our councillors.

How will the vote go in Carmarthenshire? I’m not going to guess, but do think that the coalition in power, trying to implement deep financial cuts, has an especially tough job. Their councillors have a record which electors can vote against, while the opposition has only had to oppose.

Plaid Cymru are the dominant force by numbers in the county, with 29 councillors, followed by Labour (22), the Independent group (20), People First (1) and unaffiliated (2).  The Executive Board, which does much of the decision making, is a coalition with five Plaid members and five from the Independent group. The leader of the Board is Plaid’s Emlyn Dole (Lannon), and he has two deputies – David Jenkins (Plaid, Glanaman) and Pam Palmer (Independent, Abergwili).

Labour was in power, with the Independents, until May 2015, and so come the elections, will have been in opposition for two years – long enough for some of their more questionable decisions to be relegated to the back of voters’ minds.

Plaid, though, will be completing two years in the media spotlight, and has to answer to the electorate for decisions made when they were the opposition, decisions such as rural school closures, small town parking charges, the expensive stadium for the Scarlets at Trostre, and legal adventures involving the chief executive and top staff officer, Mr Mark James CBE.

Mr James’ clash with local blogger Jacqui Thompson has been documented in detail – on this blog here, herehere and here. Mr James won. To obtain the damages he was awarded, he could force the sale of Jacqui’s bungalow home, which is also the base for her husband Kerry’s forestry work.

The Thompson v. James and James v. Thompson libel cases still carry a big risk for the councillors in power. Private Eye commented in its November 11th issue that Mark James “persuaded the council to indemnify his legal costs, contrary to guidance from both the Welsh and UK governments”.  The Wales Audit Office said Mr James’ indemnity was unlawful.  It doesn’t take much imagination to guess how national media would present the story – highly paid local government boss got taxpayers’ cash to back libel action against housewife critic. Or similar. It wouldn’t be pretty, and almost certainly the county council would be presented as the Big Bad Wolf, with Mrs Thompson in the role of Red Riding Hood.

Voters tend to remember stories with emotional appeal more than intricate factual detail, whether or not the facts are correct.

And emotional appeals before elections can have far-reaching impact.

Just think Trump. ‘Make America Great Again’ struck an emotional chord. It had nothing to do with facts.


Over-ambitious investment promises fail at Laugharne’s Corran Resort

When bank base rate is 0.25%, investments offering up to 15% a year, and an uplift in capital, look too good to be true.

In the case of the Corran Resort and Spa near Laugharne, Carmarthenshire, the promised returns were too hot, and have evaporated into the air above Carmarthen Bay.

Kayboo Ltd, the company owning the freehold of the resort property — currently a 21-room hotel with a spa – was forced into administration on October 18th.  Creditors were kicking up a fuss because, they claimed, they had not received the advertised returns, and they could not withdraw their capital.

Comments from unhappy investors  on the website ‘question.com’ include:

“I invested in a glitzy hotel scheme called Corran Resort and Spa. The hotel is still operating in Wales and hundreds of investors have put money in that scheme. I have been asking for buy back of my investment for more than a month but no reply from them.”

“It is not clear to me where all the funds of the investors went.”

“They were paying quarterly till Q3 2015. Then they stopped and I understand they stopped for everyone.”

During the final quarter of 2015, the Corran had to digest Carmarthenshire County Council’s decision to refuse a planning application (reference W/31936) for 200 lodges, a swimming pool and additional restaurant, because of the proposed location in a flood plan, and fears of significant ecological damage. Kayboo said it had a deal agreed with the US-based resorts, hotels and self-catering multinational Wyndham Worldwide to partner it in the lodges venture – but no permission, no well-heeled partner either, and disappointment for Kayboo’s directors Keith Stiles and Peter Burnett.

West Wales News Review’s previous concerns about the investment model were aired here in December 2015,

Investments in the Corran are still being advertised, for example on buytoletinvest.com and quantaxinternational.com. Buytoletinvest.com advertises annual returns of 10% net from years 1 to 10, and 15% between years 11 and 15, with assured resale at 125% of the original investment after year 5, rising to 150%. The promotion claims “Customers can also sell their property on the open market, typically for far greater capital returns.”

Buyers were offered fractions of a room, such as one-twenty-sixth of a ‘boutique suite’ for £18,000 in 2015, as well as whole suites, but the formula relied on high occupancy at very high room rates, such as £340 a night for dinner, bed and breakfast in a top-notch suite at a weekend.

Kayboo’s most recent annual accounts, for the year to March 31st 2015, show tangible assets of £14.5 million, up from £11.5 million the year before, and net assets of £867,092, more than double the year before. £1.572 million had to be paid to creditors within one year, and £14.167 million more after that — an excessively heavy obligation, especially if the physical assets had been optimistically valued.

The message? Mega returns might occasionally materialise, but they don’t come without mammoth risks.


Lloyds Bank to close in Llandovery

Lloyds Bank in Llandovery is to close completely on March 7th 2017.

As recently as 2012, Llandovery was home to four banks — Barclays, HSBC, Lloyds and NatWest. One by one, they have fallen victim to online banking.

HSBC, in Market Square, closed in 2012. Nat West, also in Market Square, shut its doors on June 1st 2015. Lloyds and Barclays soldiered on as part-time banks, Barclays open on Mondays, Wednesdays and Fridays, and Lloyds on Tuesdays and Fridays.

Now that Lloyds is to close, a part-time Barclays will be the only bank left in town.


Lloyds Bank, Llandovery. Photo: Dyfed Family History Society, copyright Pauline Eccles, Creative Commons Licence 

The impending Lloyds closure is of more than commercial significance. The imposing building, Prospect House in High Street, was the final headquarters of the Bank of the Black Ox, the pioneering venture set up by successful drover David Jones in 1799, and taken over by Lloyds Bank in 1909.

Campaign to keep Lloyds open in Llandeilo

Llandeilo’s county councillor, Edward Thomas (Independent), started work at Lloyds in Llandovery in 1971, and regrets the ending of over 200 years of history. He is also worried about the future of Lloyds in Llandeilo, which has cut opening days from five a week to three – Monday, Wednesday and Thursday — and has written to Jonathan Edwards, MP for Carmarthen East and Dinefwr.

The letter raises Cllr Thomas’s concern that “the Llandeilo Branch of Lloyds Bank has only a short amount, two years, left on its lease of 137 Rhosmaen Street” and that there is a strong indication that “with the reduction of hours, reduction of days from five to three, that Lloyds Bank are planning to close this branch”.

“I am sure you will realize that that will leave Lloyds customers in North Carmarthenshire with no coverage and effectively their nearest branches will be Brecon or Ammanford,” continued Cllr Thomas.

“I am concerned that this will leave customers with no choice. The bank no doubt will state that they no longer see the footfall in their branches as customers are switching to internet banking. I am sure you will agree this is just cynical and does not look after older customers who are not happy to deal with a faceless computer and appreciate the good service provided by our local branches.

“I hope you will raise this matter at the highest levels and whilst I am singling out Lloyds, the other banks are doing the same thing and we could be faced with our rural communities without bank representation.”

HSBC has closed in Llandeilo as well as in Llandovery, leaving customers in northern Carmarthenshire facing journeys to branches in Ammanford, Carmarthen or Lampeter. Lloyds customers could soon face the same travel demands.

Mobile Lloyds Bank coming soon

Lloyds says that mobile branches should be in the area soon.

The bank’s spokesperson said that the Llandovery branch “has been identified for closure because of the changing way customers choose to bank with us, which has resulted in customers using it less often.  The majority of customers also now regularly use alternative branches or use other ways to bank such as online and telephone banking to complete their banking needs. We apologise for any inconvenience that this may cause and have informed customers of the closest alternative branches.

“We are also investing in a new fleet of mobile branches for Lloyds Bank to help customers in more rural communities, alongside other ways to access banking locally. One of the new mobile branches will visit Llandovery. Full details of the mobile branch service will be available in advance of the new service becoming operational.”

The bank said that around 80% of personal customers in Llandovery already use other branches, such as Llandeilo branch. In 2015, the number of personal customers using Llandovery branch fell about 36%, leaving only 35 regular weekly personal and business customers.

The Post Office is an option, says Lloyds. In Llandovery it is less than 200 metres away, and customers can deposit cash and cheques and withdraw money there. In addition there is an ATM outside Barclays Bank.


Post Navigation

%d bloggers like this: