A clearing bank launched just three years ago is raising tens of millions of pounds of fresh funding just days after it was served with a winding-up petition by the UK tax authorities.
Sky News understands that The Bank of London, which attempted to rescue Silicon Valley Bank UK last year, is progressing plans for the capital-raising, which one person close to the company said could secure “up to £50m”.
The precise figure was unclear this weekend.
The new funding is understood to be being lined up from a number of investors including an entity called Aphorism Holding, according to the person.
Nada Hadadi, a wealthy investor who was suggested as being the primary source of the capital, has in fact only contributed a six-figure sum.
News of the company’s capital-raising plan comes days after it announced that Anthony Watson, its founder and chief executive, was stepping down to become a senior adviser and non-executive director of its holding company.
HM Revenue & Customs had issued a winding-up petition against The Bank of London’s holding company over unpaid taxes.
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The liability has now been settled, according to an insider.
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At least eight convictions predating the Horizon Post Office scandal are being looked at by the body investigating potential miscarriages of justice, Sky News has learned.
The Criminal Cases Review Commission (CCRC) has confirmed it is examining multiple cases of former sub-postmasters affected by Capture software.
The computer accounting system was used in the early 1990s, prior to Horizon being introduced to Post Office branches from 1999 onwards.
Horizon was at the centre of the Post Office scandal and saw hundreds of sub-postmasters wrongly convicted of stealing from their branches.
The Kroll report, commissioned by the government earlier this year, found that Capture had bugs and glitches and there was a reasonable likelihood it had caused cash shortfalls too.
Lord Beamish, the former Labour MP Kevan Jones, has been supporting victims and is calling for the government to extend current legislation to automatically quash convictions.
The Post Office (Horizon System) Offences Act was passed in May but does not include Capture victims.
Lord Beamish told Sky News he has raised the issue with the justice secretary and called for a House of Lords debate.
“The government are going to have to take this seriously,” he said. “We can’t have a situation where we have a two-tier system where people get exonerated from Horizon and the Capture cases are either forgotten or have to go through a very lengthy legal process to get their names cleared.”
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He added he had “little faith” in the CCRC’s “ability to deal with cases”, after multiple Horizon cases were referred to the body years ago.
“The problem with these cases is the lack of evidence… that has been destroyed or lost – so actually proving some of these cases through that process will be very difficult.
“Therefore I think a blanket exoneration like we had with Horizon I think has got to be discussed and considered for these cases.”
The CCRC told Sky News it has five cases under review “in which the Capture IT system could be a factor”.
It also said it is “seeking further information” on eight cases referenced in the Kroll report.
The CCRC added that the time taken for a case review to be completed was dependent on the “complexity” of each case “and how readily available information about it is”. In a statement, it admitted: “The availability of information can be a particular hurdle in older cases.”
Chris Roberts’s mother, Liz Roberts, was convicted in 1999 of stealing £46,000 from the Post Office and spent 13 months behind bars.
Liz, who was in the advanced stages of Alzheimer’s disease, passed away earlier this year.
Chris said she was jailed four days before he turned 17, and he used to have “nightmares” that she was “going to die in there”.
“There was no evidence of any financial gain because they went through everything. And obviously the money wasn’t in our accounts because it didn’t exist,” he added.
Despite being offered “three deals” by the Post Office to plead guilty, Liz refused and was sent to prison.
Chris believes that the 2019 High Court win by Horizon victims was a missed opportunity for the Post Office to look back at Capture cases.
“It would have been worth something then because my mum would have died knowing that everybody else knew she was innocent,” he said.
“My dad would have died knowing that the love of his life wasn’t vilified as a criminal.”
Chris wants his mother exonerated and “those actively responsible” to “stand up in court… and justify themselves”.
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6:19
Sky’s Adele Robinson examines Britain’s biggest miscarriages of justice
A Department for Business and Trade spokesperson said: “We were horrified to learn about the issues with the Capture system and are working closely across government to thoroughly examine Kroll’s independent report and consider what action should be taken.
“We continue to listen to postmasters and others who have been sharing their views on the report’s findings since its publication last month.”
Long-awaited legislation to abolish England’s “feudal” leasehold property system will be published in the second half of next year, the government has confirmed in a major update for the millions of people affected.
In a Written Ministerial Statement (WMS), housing minister Matthew Pennycook gave the first details of how quickly Labour intend to axe the controversial form of homeownership, as promised in their manifesto.
The minister said there will be a consultation and white paper early next year to get the plan in motion, with the aim to make commonhold “the default tenure” by the end of parliament in 2029.
The news has drawn a mixed reaction from those caught up in the system, with some hailing an end in sight and others saying it is too little too late.
What is leasehold?
Leasehold is a centuries-old form of tenure that is unique to England and Wales. People who buy their home with a lease buy the right to live there for a given number of years but don’t own the land itself, regardless of whether it is a house, or a flat in a building.
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That is the preserve of the freeholder, who can charge expensive ground rents simply for owning the land, as well as service charges for the maintenance and insurance of the properties.
There have long been concerns around leaseholders being exploited, especially by unregulated managing agents who are typically contracted to oversee the day-to-day running of buildings and can charge large fees on any works they arrange.
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0:44
Michael Gove in 2023: Leasehold ‘unfair form of property ownership’.
Criticism intensified after the building safety scandal that emerged post-Grenfell with many homeowners facing crippling bills for remediation, leaving them stuck in worthless properties they cannot sell.
That’s the case for leaseholder Peter Batt, who has not been able to live in his “once lovely” flat in Kent for the past nine months because the roof of the building has “completely failed and is disintegrating”.
This has caused damp, black mould and leaks so severe his neighbour’s ceiling below him has collapsed
The problems were raised to the building’s managing agents in February but no remediation has occurred.
Last week he was told he’d need to cough up £18,000 for his share of the works before any repairs can go ahead – money the 60-year-old doesn’t have.
“I genuinely see no way out unless I win the lottery, it’s been an utter nightmare”, he told Sky News.
Mr Batt and his neighbours want a temporary tin hat cover to be prioritised, given this was recommended by surveyors back in April to stop the situation deteriorating – which they say it now has.
But they have “no say over this despite shouldering all the costs”, Mr Batt added.
“The government need to look at root-and-branch reform because, in my experience, all the parties currently charged with maintaining building such as my own are incentivised almost solely around maintaining their revenue stream.
“Under the current system, no one is on the leaseholders’ side and that has to change.”
‘Death knell of leasehold’
In his WMS, Mr Pennycook said the government will introduce a “comprehensive new legal framework” on commonhold, including banning the sale of leasehold flats and converting existing leasehold tenures to the new model.
Proponents of commonhold say it would drive up safety standards, as it would give flat owners more control of the maintenance of a building while removing the cash incentive for developers to build homes on the cheap – knowing leaseholders can pick up the costs.
Sebastian O’Kelly, of the Leasehold Knowledge Partnership, welcomed today’s announcement as the “death knell of leasehold”.
He advised people not to buy leasehold properties as “the market will force pace on this”, pointing out that some developers have recently come out in support of commonhold while others “whose reputations have been shredded by the Grenfell findings will follow”.
He told Sky News: “With this momentum the reforms to improve the blighted lives of existing leaseholders will be eased. Government may think this process will be slow, but house builders will know that the leasehold game they have played so assiduously is busted.”
Delay in implementing Tories’ ‘half-baked’ reforms
But there was a more muted response from the National Leasehold Campaign, which has spent six years trying to dismantle the system.
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2:35
‘Exorbitant’ ground rents for ‘no service’
As well as announcing a roadmap for abolishing leasehold, Mr Pennycook set out a timeline for implementing reforms in the Tories’ Leasehold and Freehold Reform Act (LFRA), which just about made wash-up when Rishi Sunak called the July election, after being watered down by then housing secretary Michael Gove.
The LFRA promised to abolish leaseholds on new houses but not new flats, which make up 70% of the estimated 5 million leasehold properties in England.
It also aimed to give leaseholders more rights and protections, but Mr Pennycook said the act was “half baked” so there would be delays in implementing some of its measures.
Crucially, that includes rules around new valuations, which will be consulted on next summer, he said.
‘Endless cash cow continues’
The NLC called this “very disappointing” as the mechanism was designed to make it quicker and cheaper for people to buy their freehold or extend their lease “enabling them to sell their properties and move on with their lives”.
“Our main concern now is the fate of existing leaseholders who are currently suffering at the mercy of unregulated managing agents and unscrupulous freeholders,” it added.
“The government’s published intention to ‘act as quickly as possible’ will not be quick enough and we are already seeing the despair from some NLC members who are facing bankruptcy due to escalating service charges.
“Since 2018, leaseholders have heard time and time again from former government ministers that they will end the abuses but in reality nothing has changed for existing leaseholders. Using our homes as an endless cash cow continues and millions remain trapped.”
The main fall off in buying was in clothing stores, which fell by 3.1% over the month as October temperatures remained high. Retailers across the board, however, reported consumers held back on spending ahead of the budget, the ONS added.
Just a month earlier, in September, spending rose 0.1%. Despite the October fall, the ONS pointed out that the trend is for sales increases on a yearly and three-monthly basis and for them to be lower than before the COVID-19 pandemic.
Retail sales figures are significant as household consumption measured by the data is the largest expenditure across the UK economy.
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The data can also help track how consumers feel about their financial position and the economy more broadly.
Rebounding already
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Also released on Friday was news of a rise in consumer confidence in the weeks following the budget and the US election.
Market research company GfK’s long-running consumer confidence index “jumped” in November, the company said as people intended to make Black Friday purchases.
It noted that inflation has yet to be tamed with people still feeling acute cost-of-living pressures.
It will take time for the UK’s new government to deliver on its promise of change, it added.
A quirk in the figures
Economic research firm Pantheon Macro said the dates included in the ONS’s retail sales figures could have distorted the headline figure.
The half-term break, during which spending typically increases, was excluded from the monthly statistics as the cut-off point was 26 October. Typically midterm is included in the data.
With cold weather gripping the UK this week clothing sales are likely to rise as delayed clothing purchases are bought, it added.