Wellesley Reviews 1,011

All the "dodgy" recent transactions are listed from page 119 of the CVA proposal. Everyone must read this section as I think it will have (should have) a big impact on how you vote.

Over £20m of cash has gone elsewhere when they should have been using it to pay us back! Under administration this could be clawed back.

During this time, Graham Wellesley also paid himself £350k a year salary

Why did the massively discounted in-house sale of the Wellesley loan book to Cloverleaf need to take place at all? They could easily have worked with their clients to overcome the transient cash flow issues; but the in-house massively discounted sale and CVA allows Wellesley Directors to cynically make huge amounts of money for themselves entirely at the expense and loss of their clients as the loans get re-paid [which they will]. Director payoff=True loan book value-paltry CVA payments. Client payoff=Paltry CVA payments. Directors make money despite their appalling and incompetent performance over the years. Clients lose money. The true Wellesley Way.....

The Wellesley web of deception has hit us. The CEO etc should have used there own money and taken pay cuts.Financial reporting to creditors wasn’t good either.They should of consulted creditors before selling off a loan book which was perhaps over valued. What about the conflict of interest issue on selling a loan book to yourselves. When technically we own it but didn’t have a say in it. Why was it allowed without any form of consultation? It wasn’t that long ago that they were still asking people to invest. Covid isn’t a fair excuse. Please start a twitter email. They have left creditors in the cold to freeze.

I have emailed Duff and Phelps and no answer for over a week.
This really smells fishy.
Wellesley failed to inform us of any Shortfalls for months. Suddenly we are hit with a do or die email.
Surely there could have been some other compromises prior to this.
Perhaps that they would return our capital with no interest.
Those of us who have maturing investment this year should have them returned
These Wellesley directors have been paying themselves ridiculous bonuses from our hard earned cash and now we are being rewarded,

Gentlemen/Ladies,
Try not to let your judgement be clouded by the outward animosity towards a Peer of the Realm. It was a business run by persons of dubious character who may well now be rubbing their hands in glee at their timely windfall.
Surely we need to work towards a more beneficial outcome to a dire situation.
This may be daylight robbery but has anyone got legal training that can say whether a crime has been committed. If a crime has been committed, then I'm sure some hungry barrister would take up the cause.
If not, and I don't trust any of the regulatory bodies to come to our rescue, then a stark decision is required.
Previous correspondents have stated that an 'administration payout' would probably amount to very little in compensation.
A CVA may fare a little better but I suspect not much.
In all transactions, especially financial ones, buyer beware...................there are many sharks out there!
Moral of the story, only invest in fully backed investments.

At first when I received the e mail I thought that it was just another Covid situation and I was lucky to get anything back but once I began to research and realise that the sale of the loan book is inhouse and the directors of Wellesley stand to make huge amounts on our suffering then I will vote AGAINST the CVA. I realised some time ago Wellesley were suspect but was tied into a 5 year P2P loan. Which should have matured yesterday. If anybody were to start an action group then I'm in. Meantime I am going to hassle the media and Ombudsman and anybody else who will listen.

What a nightmare investing with Wellesley. I am in my 70s and disabled. I am just a man who has worked hard all his life and was seduced by the Wellesley "sales pitch" designed to catch people like me. Now, having taken my hard earned savings, they cannot be contacted. I am a mug. Is there any wider group I can join with to bring Wellesley more to account?

I had a lot of money invested in Wellesley. I've now had a chance to review the CVA in detail. I share others' concerns:
- Management have sold a loan book worth £71m (after writing down bad debt provisions) to another company within the group for £45m. Under the proposed CVA, the creditors will not share in any upside in the recovery of the loan book over and above the £45m, with the shareholders taking all the upside. This seems possibly in contravention of section 238 of the Insolvency Act 1986
- Under standard insolvency practice, it is normal for the shareholders to take financial loss before bond-holders. Under the CVA that is proposed, it is unclear what financial loss (if any) the shareholders will be taking. It appears that the bond-holders are being asked to take all of the financial loss.
- The reason cited by management for the actions taken is a liquidity issue. However, at no stage has Wellesley put to the creditors any other options (e.g. reduction in interest rates, deferral of repayment) that would address the liquidity issues and allow an orderly wind down of the loan book. Other FinTech companies (e.g. Ratesetter, Funding Circle) have been adopting these measures relatively successfully to ensure that investors are treated fairly. Management have instead presented the CVA as the only alternative to administration.
- In addition, other FinTech companies have provided regular communication to their creditors on the recoverability of their investments. Wellesley & Co have failed to do this throughout.
- There was a separate company set up (WST) to act as a trustee for the securities underpinning the secured bonds. The trustees of WST do not appear to have acted in the interests of the secured bond-holders by allowing the security against those bonds to be sold (at below book value) without consultation.

It may be that the directors of Wellesley & Co believe they are bona fide acting in the interests of all the bond-holders. However, it seems there are some fairly fundamental issues that need to be answered here. It smells very fishy. Unless something big changes, I will be voting against the CVA.
I have reported the matter to the FCA, financial ombudsman, my MP, the SFO, Action Fraud and the media. I suggest others consider doing the same. Update - I have now voted No.

First of all, I am personally glad that I invested only a small amount in Wellesley. I am astonished to read some reviews here where people say they have invested 6 figure sums or even their life savings. Hindsight may be a wonderful thing, but to put all your eggs in one basket, particularly not one covered by the FCSC, is unbelievable.

Anyway, onto the CVA. I read it and it promised me so much if I voted for, so much if I voted against. Both figures were actually quite close to what I was owed. When I’d voted, I got a document emailed to me outlining what my claim was. It appears to be less than half of what I was promised on the website. To be honest, I laughed at their bare faced cheek. But then I’m fortunate enough to have only a small amount involved.

A harsh lesson learned

Voted against CVA due to fraudulent in house sale of loan at huge discount to their own company

I'm totally disillusioned.
I am so shocked at what's happened overnight with Wellesley. I have had good returns & service from them for about 6 years so this is a kick in the face. I was silly enough to invest far too much with them (over £145,000) in property bonds, mini bonds and property mini-bonds. It was annoying that they couldn't think up better names for the various types of investments.
The CVA statement is too dense and complicated to read, so I would have to pay a IFA or solicitor to decipher it. Perhaps that is intentional.
However, I am persistent. I have written to my MP and will contact all the relevant people and organisations suggested.
We investors should have been consulted and allowed to vote on whether the loan book was sold, then we could have had some say. It would have been interesting to see the other bids, or the effect of reducing the interest rate paid to us (which I would have accepted). This is what Zopa (another unprotected institution which started with peer-to-peer loans) have done.
If there is someone out there willing to form an action group, I will certainly join it.

I still can’t believe I have been conned by a lord !
Faulty towers had it right !
Ready to join an action group will not be voting for CVA

Totally disgraceful behaviour. They clearly were not telling the truth when they lured us in to their investment. They told us of all the safeguards in place, secured loans, their own funds to bear any losses, etc., etc. I lost money long before the pandemic and was refused a request to get my money out. So they were in trouble long ago.

Then they sell the loan book to themselves at half price because they can't fund future commitments to their borrowers? So where did they get the money to buy their own loan book, even if they discounted it at half price, and they still have to find money to finance these future loans to borrowers that they can't find now, so where is that coming from??? If they have the money to buy the loan book, then they have the money to finance their loans to existing borrowers, so they can carry on! Could a change of management do a better job and pull the company out of insolvency. Has any of this been looked into?

It all sounds so fishy to me, surely they must be some regulatory body that would investigate for the peace of mind of investors who stand to lose a lot of money and yet the company carries on!! I am not certain that voting in favour of the CVA and allowing them to continue is the best course of action, will we ever see any money? They could lose that too over the next 1-3 years that it's going to take to reimburse investors with the paltry returns that they are proposing. I think I'd have more faith in an independent administrator.

I've just spoken to the FCA and Wellesley Finance Plc, who issued their Mini-Bonds, are not authorised or regulated by the FCA so therefore have no jurisdiction and can provide no help or investigation into the actions taken by Wellesley.

The only advice they could offer was to contact Citizens Advice (Tel: 03444 111444).

Only Wellesley & Co Limited are authorised and regulated by the Financial Conduct Authority (FCA).
....
I have read the CVA proposal and have had a few points clarified with Wellesley helpdesk. Consequently I have decided to vote against the proposal. I tend to agree with the majority of what Chris and others have written. It will be interesting to see if we can get any better redress by combining forces?

I have also voted against.
The question is - do you trust this lot with paying out what they say they will or would you rather put your trust in an administrator.

A five year peer to peer investor I have voted against their proposal to buy themselves back, if the proposal is not a legal fraud it should be. They were in significant trouble long before the virus they seek to blame.

Contacting the Financial Services Ombudsman is pointless. It's less use than a chocolate teapot, and has neither the staff nor the inclination to resolve complaints.

The FCA is also useless.

We could try reporting Garret Graham Wellesley to the police for financial fraud, but then the police won't be interested. They're too busy prosecuting people for sending hurty tweets.

I totally agree with Chris. This is a scam so that Wellesley can keep on trading. How can selling a loan book effectively to yourself at 50% of its value to effectively reduce your liabilities be allowed by law!! We should not vote to allow them to take more money off other people in the future. They are utterly incompetent and should be prosecuted not rewarded. They have used more than half a million pounds of our money to pay Duff and Phelps to help them pull this off!

I have now read much of the CVA Proposal and it’s a way of legitimising a fraud conducted by the Wellesley Group. Let me summarise.

We have lent roughly £100 million to Wellesley Finance plc who have in turn lent our money to property developers (so £100 million). The problem Wellesley Finance faces is one of cash flow not of capital they had the funds to pay us all back, just not now (but as and when the Developers repay their loans).

However the directors (Garret Graham Wellesley, 8th Earl of Cowley et al) used the excuse of poor liquidity to sell the Loan Book (the £100m lent to developers) to Cloverleaf 376 Limited (owned by Garret Graham Wellesley, 8th Earl of Cowley et al) at more than a 50% discount.

So the directors of Cloverleaf 376 Limited get £100m of assets for £50m (bumper pay day for them) and they then pay £50m to Wellesley Finance plc as the property developers repay their loans. However as Wellesley Finance plc now has assets of £50m due to the sale of said Loan Book, while still retaining the £100m of debts to us, Wellesley Finance plc no longer has the assets to deal with our debts and so are instead asking us to voluntarily reduce our debts by 50% or more.

The directors of Wellesley Finance plc (Garret Graham Wellesley, 8th Earl of Cowley et al) by selling the loan book at a discount to themselves have broken the Companies Act 2006 namely the Duty to:

• Promote the success of the company
• Exercise independent judgment
• Avoid conflicts of interest

What should you do?

• Reject the CVA Proposal
• Write to the Financial Ombudsman Service at: Exchange Tower, Harbour Exchange, London, E14 9SR, or by calling them on 0800 023 4567.
• Write to your local MP
• Write to Financial Journalists like Martin Lewis

They have used the excuse of COVID to avoid a debtholder meeting whereby this information could be shared and relayed to others and are further trying to bounce this rotten CVA deal through before anyone realises what has happened and after everyone has signed up to the new arrangement.

On a side note Garret Graham Wellesley is also a Hereditary Peer (someone who has become a member of the British House of Lords because their parent was a member) so his actions pour yet more light on why the House of Lords must be disbanded or Reformed.

Share this far and wide, Wellesley will attempt to report this review

Further more for those that may wonder, I am a series 2 investor so look to loose all the money I invested, my entire life savings of £40K. I have rejected the CVA.

I do not know, but if Wellseley was pushed into administration the administrators may look at the recent sale (within the last few weeks) of the loan book as fraudulent and reverse it. It may be too late but I'd rather take my chances with an independent administrator than Wellesley.

For those that argue the Financial Ombudsman will not act, you may be right, however if enough of us write in and cause a stink it will be noticed.

I have now emailed every single media organisation I can think of to air my views that the actions taken by Wellesley are fraudulent and ask them to investigate.

We can only hope that the stench clinging to Wellseley sticks.

Don't get angry, get even, fight them and their fraudulent actions.

I wouldn’t have given them 1 star if I could. Wellesley has basically ripped us all off in spectacular fashion. They offered to sell the loan book and had numerous other companies (10~15) bidding (funnily enough they signed NDA’s so we’ll never know their offers), the winning bid (apparently the highest on the table) went to a subsidiary of Wellesley!! This surely needs further investigation into what could potentially be fraudulent activity?

Oh well look on the bright side, Wellesley’s wife can now buy that dress she dreamed of with MY money, Utter disgrace and worse than leeching benefit scroungers!!