Avocet chairman's wife denies business is insolvent

by OUR BUSINESS CORRESPONDENT

The ex-chairman of the 'revolutionary' Avocet air-to-fuel business which never brought a commercial product to market during its six-year life is owed £1.6 million in undrawn salary and hundreds of thousands of pounds more in out of pocket expenses, according to a fellow director who also happens to be his wife.

Figures contained in Janet Orr Frost's witness statement for a court hearing in Leeds next month contrast sharply with a set of financial statistics compiled by Avocet/Omega Infinite's joint liquidators which include a claim for more than £2 million against bankrupt company director Martin Frost.

A civil action brought on behalf of Omega liquidators Joanne Hammond and Ashleigh Fletcher seeks possession of two Scarborough apartments, allegedly purchased by Mr Frost using over £430,000 of the company's money.

But in her witness statement distributed to shareholders, Mrs Frost - also a bankrupt - writes: "Martin and I decided to retire to Scarborough. Eventually I sold my two cottages, my development land, my farmland and my steading property [all in Berwickshire] to Avocet for £450,000 to fund the two apartments in Scarborough".

She adds that by February 2020 her loans to Omega Infinite totalled £984,411 'not counting my undrawn salary of £167,500'. These sums, claims Mrs Frost carried agreed interest of five per cent.

The statement also includes details of sums said to be owed by the Avocet business to her husband. At the end of 2017 Mr Frost had undrawn salary of £760,000. And by December 2019 he was due £2,943,714 not counting undrawn salary of £1.6 million and undrawn expenses of £293,760, all carrying five per cent interest.

On top of all that, Mrs Frost claims Avocet Infinite owed £2,118,598 to a company called Loch Lomond Heritage Ltd, owned and controlled by the Frost family.

In her missive, Mrs Frost declares: "Some counsel are suggesting that not only was it wrong to bankrupt Martin and I, but a financially greater wrong happened to Omega Infinite shareholders upon a company that never should have been liquidated".

According to her, a legal scam was formulated "purporting that Martin had unlawfully engineered the theft of [three named Berwickshire farms] to Avocet". 

Mrs Frost also claims administrators and liquidators of Avocet group companies apparently forgot or chose to ignore the background, especially that of AFS Ventures PLC, the precursor company to Omega Infinite. "Ventures in 2015 sold to Infinite for the sum of £4 million the bulk of its intellectual property.

"The police in Scotland and Northern England were wrongly informed that Martin and Bob Jennings [another Avocet director] have worked a Ponzi scheme to enrich themselves".

The witness statement reveals that in September 2021 a solicitor representing Omega's joint liquidators - they had been investigating the affairs of the company and the conduct of the directors following their appointment the previous year - sent a letter of claim to Mr Frost asking for payments amounting to £2,011,825.

Items detailed by Mrs Frost were: overdrawn director's loan account £1,176,871; payment to Onesti Brothers in Italy £59,347, travel expenses £129,225; payments to United Kingdom Agricultural Lending Ltd. £422,500; payments to Loch Lomond Heritage £228,872.

She states: "Infinite directors and senior executives spent over £548,000 during 2015-2020 on legitimate business expenses of which Martin paid out over £298,000, the bulk of which has not been reimbursed".

And Mrs Frost alleges the insolvency specialists failed to review Omega's intellectual property "which fault has lost the company and its creditors over £200 million".

Her statement continues: "Not only does Martin not have an overdrawn loan account with Omega, but by my calculations Martin is due millions not counting undrawn salary of £1.6 million and undrawn expenses of £293,760 from Omega.

"Furthermore, the insolvency practitioners and others are due Martin and his family an additional £15 million when his personal and family assets are added back.

"Finally, Omega Infinite was not insolvent - Fieldfisher [the law firm which applied to have Omega wound up] signed off its Memorandum of Understanding in late 2018 and declarations of solvency were given prior to the 2019 demerger agreements".