Jameson Smith & Co Ltd

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Tuesday 15 May 2012

North West Landbanking Companies Wound Up by Insolvency Service


Following an investigation by the company investigation department of the Insolvency Service, two landbanking companies based in the North West have been wound up.

Sterling Mortimar of Southport and CLS & Partners, based in Warrington, sold small plots of land in Wakefield to investors, on the premise that CLS & Partners would pursue planning permission for development of the land with a view to sell the site to a developer. Investors were assured that planning permission would result in a huge increase in the value of the plots.

The findings of the investigation by the Insolvency Service showed that neither company had made an application for planning permission to develop the site, and had they done so, it was highly unlikely that it would have been granted by the local authority. Agents selling on behalf of the companies, mislead investors that permission had already been taken care of.

Around 74 plots were sold to investors totalling the amount of £924,600, of which all of the funds were spent by CLS & Partners. It’s bank account was closed in November last year. Much of this expenditure is unexplained as adequate accounts had not been kept. £212,000 had been spent on the purchase of auctioned motor vehicles, and further £483,500 had been paid to associated company, Curved Ball, a company that had been dissolved in late 2011.