Hackney’s missing millions: the ghost hunt continues
Special issue 2. Tuesday, March 7.
© Andrew Veitch
So many documents have gone missing from council files that officials are struggling to find how much Hackney has been paid for 42 properties worth millions of pounds: and 113 ghost buyers have yet to be traced.
Paul McLoughlin from the council’s audit and anti-fraud department admitted under questioning at the council’s property sales enquiry last night (Monday, March 6) that documentation on the sales was inadequate. Monitoring officer Meic Sullivan-Gould told the enquiry he was still trying to trace how much the properties were sold for, when they were sold and who bought them.
The gaps emerged in records released last week. Councillor Jim Cannon (Lab) who is leading the public enquiry, gave officials one week to track down the money and the mystery owners. Last night Sullivan-Gould said he had yet to resolve the unknowns, but insisted he was making progress. The four councillors who make up the enquiry want answers in time for their final meeting next Tuesday: they have to report before the council disbands for the local elections.
The enquiry covers commercial property sold by Hackney over the past six years to stave off financial collapse. The fire sale was intended to raise some £70 million. Because of the missing documents, officials can only guesstimate that they have raised around £58 million.
Hackney’s ruling Labour group says it has solved what it calls the mismanagement that caused the chaos. However the latest gap in the sales records (a ghost buyer of property in Forest Road E8) is dated January this year.
The council’s internal auditors, Price Waterhouse Coopers, are to check whether improved financial controls recommended last year following their own investigation have been implemented. Simon Sharp of PWC told last night’s enquiry the review would be completed by April. Labour will face demands for the results to be published before the election on May 4.
Internal enquiries and a police investigation have found no evidence of impropriety, however the police and the Public Sector Fraud Office have reopened their investigations.
More documents released by the public enquiry last night confirm that Grant Walker of Nelson Bakewell gave Spirit (Lowell Grant) less than four weeks to raise £100,000 to buy his shop, the Nutritious Food Galley at 71 Broadway Market before it went for auction. The documents don’t show - and officers have failed to find out - why despite paying Nelson Bakewell a £10,000 deposit, his property was auctioned to Broadway Investments Hackney, a Bahamas-based property company, for less than he offered. A massive rent rise followed and Spirit has taken the case to court.
A company in the same Bahamas-based group bought 14 properties in Dalston Lane at auction. Bill Parry-Davies, a Dalston solicitor, told the enquiry last night that leaseholders had gone to the auction to bid for individual properties, only to be told that instead of selling them separately Nelson Bakewell had decided to sell them as one lot. The auctioneer took telephone bids from an anonymous buyer who was obviously well-known to him. According to Mr Parry-Davies, the auctioneer said to the telephone bidder when the auction was over: “Give my regards to your father, Jack.”
The company turned out to be Dalston Lane Investments. They paid £1.8 million for the 14 properties. Parry-Davies said the combined bids from the leaseholders would have totalled £3.2 million. The properties had thus been greatly undervalued. “The effect of putting the bids in one lot was to deprive local people of the opportunity of bidding”, he told the enquiry. “The council has not followed a lawful and democratic process. What is happening now in Dalston Lane is consistent with what happened in Broadway Market.”
The enquiry was told that the new owners had allowed the properties to decay and were not renewing leases. Only three shopkeepers were left: four buildings in the terrace had been burnt out, the rest were empty.
One of the survivors, Peter Powell of High Tech Electronics said: “This guy is trying to run us out of the buildings.”
It also emerged last night that Tony Platia was given less than four weeks to raise £130,000 to buy the freehold of his café, Francesca’s, at 34 Broadway Market. The council decided to sell the freehold in December 2002. It was not until January 20 2003 that Nelson Bakewell wrote to Tony Platia giving a guide price of around £130,000. The auction was held the following month. It was sold to the developer Roger Wratten for £186,000. Following the eviction of Tony and the protesters, the café has been allowed to decay, like the Market House next door, which Wratten also owns, rotten teeth in what is otherwise fast becoming a bright new Broadway.
Cllr Cannon told the witnesses last night that the enquiry’s job was to investigate whether the sales had been conducted legally and openly, and what action could be taken to rectify any mistakes.
“I hear what you are saying,” he added. I hope we may be able to make recommendations that help, but we may not.”
(The enquiry will hold its final public meeting on Tuesday March 14 at 2pm in the Town Hall.)
Department of error
Bill Parry-Davies is misquoted as saying that individual bids from Dalston Lane lane leaseholders would have totalled £3.2 million. The figure came from Paul McLoughlin of the council’s audit and anti-fraud department and it is hypothetical: it was not tabled at the auction because the leasholders were not given an opportunity to put together a combined bid. And I have been asked to make it even clearer that the auctioneer must have known the telephone bidder in order to accept his bid.
Links: broadwaymarket.co.uk
34broadwaymarket.omweb.org
hackneygetsrippedoff.blogspot.com
hackneyenvironment.org.uk
Special issue 2. Tuesday, March 7.
© Andrew Veitch
So many documents have gone missing from council files that officials are struggling to find how much Hackney has been paid for 42 properties worth millions of pounds: and 113 ghost buyers have yet to be traced.
Paul McLoughlin from the council’s audit and anti-fraud department admitted under questioning at the council’s property sales enquiry last night (Monday, March 6) that documentation on the sales was inadequate. Monitoring officer Meic Sullivan-Gould told the enquiry he was still trying to trace how much the properties were sold for, when they were sold and who bought them.
The gaps emerged in records released last week. Councillor Jim Cannon (Lab) who is leading the public enquiry, gave officials one week to track down the money and the mystery owners. Last night Sullivan-Gould said he had yet to resolve the unknowns, but insisted he was making progress. The four councillors who make up the enquiry want answers in time for their final meeting next Tuesday: they have to report before the council disbands for the local elections.
The enquiry covers commercial property sold by Hackney over the past six years to stave off financial collapse. The fire sale was intended to raise some £70 million. Because of the missing documents, officials can only guesstimate that they have raised around £58 million.
Hackney’s ruling Labour group says it has solved what it calls the mismanagement that caused the chaos. However the latest gap in the sales records (a ghost buyer of property in Forest Road E8) is dated January this year.
The council’s internal auditors, Price Waterhouse Coopers, are to check whether improved financial controls recommended last year following their own investigation have been implemented. Simon Sharp of PWC told last night’s enquiry the review would be completed by April. Labour will face demands for the results to be published before the election on May 4.
Internal enquiries and a police investigation have found no evidence of impropriety, however the police and the Public Sector Fraud Office have reopened their investigations.
More documents released by the public enquiry last night confirm that Grant Walker of Nelson Bakewell gave Spirit (Lowell Grant) less than four weeks to raise £100,000 to buy his shop, the Nutritious Food Galley at 71 Broadway Market before it went for auction. The documents don’t show - and officers have failed to find out - why despite paying Nelson Bakewell a £10,000 deposit, his property was auctioned to Broadway Investments Hackney, a Bahamas-based property company, for less than he offered. A massive rent rise followed and Spirit has taken the case to court.
A company in the same Bahamas-based group bought 14 properties in Dalston Lane at auction. Bill Parry-Davies, a Dalston solicitor, told the enquiry last night that leaseholders had gone to the auction to bid for individual properties, only to be told that instead of selling them separately Nelson Bakewell had decided to sell them as one lot. The auctioneer took telephone bids from an anonymous buyer who was obviously well-known to him. According to Mr Parry-Davies, the auctioneer said to the telephone bidder when the auction was over: “Give my regards to your father, Jack.”
The company turned out to be Dalston Lane Investments. They paid £1.8 million for the 14 properties. Parry-Davies said the combined bids from the leaseholders would have totalled £3.2 million. The properties had thus been greatly undervalued. “The effect of putting the bids in one lot was to deprive local people of the opportunity of bidding”, he told the enquiry. “The council has not followed a lawful and democratic process. What is happening now in Dalston Lane is consistent with what happened in Broadway Market.”
The enquiry was told that the new owners had allowed the properties to decay and were not renewing leases. Only three shopkeepers were left: four buildings in the terrace had been burnt out, the rest were empty.
One of the survivors, Peter Powell of High Tech Electronics said: “This guy is trying to run us out of the buildings.”
It also emerged last night that Tony Platia was given less than four weeks to raise £130,000 to buy the freehold of his café, Francesca’s, at 34 Broadway Market. The council decided to sell the freehold in December 2002. It was not until January 20 2003 that Nelson Bakewell wrote to Tony Platia giving a guide price of around £130,000. The auction was held the following month. It was sold to the developer Roger Wratten for £186,000. Following the eviction of Tony and the protesters, the café has been allowed to decay, like the Market House next door, which Wratten also owns, rotten teeth in what is otherwise fast becoming a bright new Broadway.
Cllr Cannon told the witnesses last night that the enquiry’s job was to investigate whether the sales had been conducted legally and openly, and what action could be taken to rectify any mistakes.
“I hear what you are saying,” he added. I hope we may be able to make recommendations that help, but we may not.”
(The enquiry will hold its final public meeting on Tuesday March 14 at 2pm in the Town Hall.)
Department of error
Bill Parry-Davies is misquoted as saying that individual bids from Dalston Lane lane leaseholders would have totalled £3.2 million. The figure came from Paul McLoughlin of the council’s audit and anti-fraud department and it is hypothetical: it was not tabled at the auction because the leasholders were not given an opportunity to put together a combined bid. And I have been asked to make it even clearer that the auctioneer must have known the telephone bidder in order to accept his bid.
Links: broadwaymarket.co.uk
34broadwaymarket.omweb.org
hackneygetsrippedoff.blogspot.com
hackneyenvironment.org.uk
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