Insolvency Service investigating 'Avocet's' affairs

by DOUG COLLIE

Omega Infinite PLC, the insolvent former parent company of the Avocet group of 'disruptive technology' businesses, is the subject of ongoing investigations by the Government's Insolvency Service as well as exhaustive inquiries by liquidators.

It was disclosed last weekend that creditors of Omega (formerly called Avocet Infinite) claim they are owed a total of £20.9 million following the company's financial collapse. The identities of those creditors have not been made public by the liquidation team from insolvency specialists Begbies Traynor.

But a progress report on the liquidation included the line: “Time has been spent liaising with the Insolvency Service in relation to their inquiries into the company’s affairs”

Not Just Sheep & Rugby asked the Insolvency Service for details of its particular investigations currently underway at Omega Infinite.

A spokesman told us: "Our enquiries are ongoing and we cannot comment on investigatory activity".

The Official Receiver has a duty to investigate the cause of failure of the company and the conduct of all individuals involved in the management of the company. If any misconduct is identified then the Official Receiver can apply for a disqualification order for a period between 2 and 15 years. 

We were told: "The Insolvency Service will pursue civil enforcement measures if misconduct is found and where there is evidence of criminal wrongdoing, our civil investigators will pass their evidence on to our criminal investigation team or the relevant prosecuting authority."

As reported earlier this week the liquidators are also probing Omega Infinite's finances. Their report says: "As the investigations are ongoing, it would be prejudicial to the investigations for us to comment in any further detail at this stage. If any creditor has any information that they feel may assist our investigations, they are invited to contact our office and provide their contact details".

Among their many threads of inquiry, Begbies Traynor mention in their report the alleged theft of Company assets. According to the document: "We are currently liaising with police and the former directors with a view to establishing the position regarding an alleged theft relating to Company assets, and the insurance position of the same. The current ownership position in respect of the assets is still uncertain and requires clarification".

The affairs of Omega Infinite are closely linked to those of an insolvent 'Avocet' subsidiary, Orrdone Farms (OF).

As the Omega insolvency team report: "OF entered into administration on 23 January 2020 and the joint administrators successfully attached to the petition to wind up the Company. The OF administrators' proposals suggest OF is owed circa £2.2m by Omega.

"Information provided by the directors [of Omega] suggests that the actual position is that the Company is owed circa £20.2m by OF. We have reviewed the position with regard to the intercompany debt between OF and the Company and based on the information received and financial records reviewed to date it appears that the Company is a creditor of OF, if deemed appropriate we will register a claim in the administration."

And the report continues: "It is also apparent that interest payments in the sum of £455,000.00 have been made from the Company's account against a loan from UK Agricultural Lending Limited ("UK ALL") to OF. It does not appear that the Company had any liability to UKALL or interest in the assets to which the security related, therefore it is uncertain why the Company would have paid the interest on these loans."

Under the heading assets, antiques and motor vehicles, Begbies Traynor report they are in the process of liaising with Eddisons, (asset sales specialists) to compile a schedule of assets, with a view to establishing ownership and arranging collection and disposal of them 

"This task has become protracted due to the lack of records regarding the Company's assets and ambiguity regarding the ownership of the same. In relation to certain assets, MD Law (solicitors) have been instructed to enter into correspondence with the relevant parties to assist with the recovery. 

"Time has been spent liaising with Close Brothers Asset Finance in Scotland with regard to recovery of farming equipment which was subject to Hire Purchase agreements. The items have now been recovered and it is anticipated that there will be a shortfall following the sale of the items.

"Eddisons have recovered a painting from the Company's accountant which was being held as collateral for unpaid fees.".

The liquidators have also been involved in assessing assets at Harcarse Hill Farm, Berwickshire, scene of a planned major farming enterprise by Avocet. The report notes:"Eddisons attended the premises owned by OF at Harcarse Hill Farm and recovered assets. Eddisons are in the process of cataloguing the items with a view to a sale by way of an online auction".