Ex-Halliwells partners head for mediation with BDO

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  • This strains credulity. I am sure the distribution was made in the best interests of the Firm; why on earth and on what possible basis should it be paid back?

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  • Tongue in cheek, I know. But why did the holders of the whole of the equity in the Firm have to care about the best longer term interests of the LLP as long as creditors weren't at that time or for a specified period after, prejudiced? Its always open to a corporate body to pay out capital profits subject to that caveat isn't it? I bet you that's their defence anyway. The fact that creditors 6 years on lost out is neither here nor there.
    Never did quite get this....

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  • Whole of the equity? Ony 32 took it whilst 130 with equity stakes were not even told about it.

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  • Perhaps that's the answer, Damned. The FSMs were technically equity, with a fixed share or similar? So they might have a claim, but the Administrator? Not so sure...

    Anyway, your point illustrates that a huge number of partners were prepared to be involved in a business where they had responsibility, but presumably no right to see the accounts which would have shown the payment. Would they have advised clients to do that? And the argument that it was take it or leave it for those people is no answer.....
    you leave it.

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  • I think the point is that the reverse premium transaction never came into the llp's accounts. They set up a company and distributed the money from there.
    No matter how good the DD the transaction simply won't show up because the 32 equity partners set up a vehicle to conceal the payment.
    If the Administrators lose then the 32 can expect to receive claims from the FSMs. If the Administrators win then only a small number of the 32 will be worth pursuing once they have stumped up cash to the Administrators.

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  • And the FSMs didn't say : oi. What company is that then? Why has it received that money?? Heavens above ...

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  • The transaction was not disclosed, the existence of the company was not disclosed and there is irrefutable evidence that those who asked about the reverse premium were lied to. The 32 tried to keep it a secret and were hardly likely to say to the fsms "you might like to take a peek at this company and take a guess at how a non trading company has 21m to distribute."
    It is all too easy for the ignorant to knock the fsms but it is unfair to do so. They were not stupid, they were deliberately misled.

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  • And who were the great mis-leader? If the money was taken wrongfully then BDO will be tracing into their pensions and anywhere else they may have stashed it. I bet there are a few trust funds which will get hit too.
    There are a number of reputations on the line with this one. BDO must be very confident otherwise they wouldn't be quite so vocal

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