Avocet bosses send $20 million to US for safety

by OUR BUSINESS STAFF

It was a breath taking day for shareholders in the 'disruptive technology' Avocet Group of companies with news of a 'high level investigation' into tax evasion, money laundering and Ponzi funding followed by the eleventh hour cancellation of an eagerly awaited general meeting for investors amid rumours of a planned demonstration.

There was also the revelation that Avocet chairman Martin Frost and his chemist colleague Dr Bob Jennings would remain in charge of flagship parent company Avocet Natural Capital until next February. This, despite the fact that Mr Frost has announced on several occasions since 2019 that he was stepping down.

The fast moving developments over the course of the day left a number of shareholders in a state of disbelief. For they were also informed that the first $20 million dollars from the $40 million dollar sale of Avocet's "jet fuel from air" patents has had to be moved to a bank in the USA for security reasons.

Mr Frost himself was the messenger - some might say the harbinger - of all these factors as he circulated two different newsletters in the space of a few hours.

In his first missive he declared: "At 11am on Monday 27th September 2021, I was formally advised that HMG [presumably Her Majesty's Government] was to conduct a high-level investigation into a series of opportune --- thefts.

"Omega Infinite Plc, its sources of funding, and its interactions with the legal professions. A major problem area is Omega’s loss of some £15 to £19 million in support of (named individual) grandeur."

After naming a host of individuals and firms said to be targets for the investigation, Mr Frost wrote: "It is understood that the complaints which have prompted this domino of enquires have come from other members of the --- family (who are fed-up with ----- deceit); the Law Society of Scotland; English based insolvency practitioners; and Scotland’s Crown Office.

He indicated the inquiry would encompass "crooked lawyers, dishonest SNP politicians, and involves false accounting & theft by (named individual), false deeds & affidavits perfected by Edinburgh lawyers, perceived falsehoods, theft & money laundering by (a named company), bad & unlawful practice by  accountancy & insolvency firms."

According to the Avocet boss directors of Omega Infinite, currently in compulsory liquidation with its creditors seeking millions of pounds, "are asked to provide information to HMRC, on tax evasion, money laundering, and Ponzi funding".

Over the course of this week we had been told that a significant number of shareholders who were seeking to access tonight's planned video link meeting which was to have had Mr Frost and Dr Jennings in attendance did not receive responses to their applications.

There had also been allegations that the calling of the meeting by ANC's directors and the proposal to approve an interim dividend were unconstitutional and any decisions taken without a proper vote could be challenged.

But some four hours before the Avocet members were due to log in Mr Frost announced the meeting had been cancelled with a replacement AGM scheduled for February 2022.

In a second newsletter sent out at around 5pm Mr Frost wrote: "I have to say that I was disappointed today to receive abusive messages & threats concerning this evening’s planned General Meeting. Rightly or wrongly, I am advised that some -----  have planned an outrageous video demonstration and have encouraged members of the Press to impersonate ANC Plc shareholders.

"Personally, I am unsure as to how they think that they can take over a video conference. Other folks are legitimately unhappy about a video conference and their inability to speak or Fili-bust. Consequently, they demanded that this evenings General Meeting is cancelled with a physical February 2021 (surely should be 2022?) replacing such. Listening to all, Bob and I have thus decided to adhere to these wishes – we shall continue in office until February and in the meantime make good on creditor payments and the proposed interim dividend.

"Tonight’s video General Meeting is thus cancelled – next February it is obvious that the AGM will need to be policed to ensure that all can safely attend".

This document also included details of the so-called interim dividend from the intellectual property sale although a significant portion of the first allocation to be released - Mr Frost gave the figure of $10 million - seems destined to pay debt and bankroll the many writs he has been threatening to serve on an array of people for more than a year.

According to the second letter: "As many are aware, ANC Plc along with its subsidiary Avocet IP Limited was in protracted discussions to sell some of the original concepts, copyrights, patents, trademarks, and trade secrets that ANC Plc holds in relation to the manufacture of jet fuel from air. 

"Note: most of this IP was not written upon in the Coller IP December 2018 valuations nor was visible in the 2016 & 2017 intellectual property switches from our US companies to our UK companies. The price obtained for this IP is $40 million US dollars which is paid in two tranches of $20 million. 

"One tranche of $20 million which is received and a further $20 million to be held on escrow in the US until January 2022 end – this second tranche as with the first is subject to anonymity undertakings. No more shall be said of the front buyer who is Middle Eastern."

But because ANC Plc had so many 'headbangers' confronting it, security measures had prompted  the firm's money to be placed "in US corporate protection". 

Mr Frost added: " Dr. Bob Jennings and I, the directors of ANC Plc and Avocet IP Limited, have decided to use $10 million from the first $20 million tranche to pay ANC Plc & some Omega creditors and provide a fighting fund to secure justice against the incompetence and perceived dishonesty of insolvency practitioners".

The rest of the cash is to be used for that long awaited interim dividend. For the avoidance of doubt here is Mr Frost's description of the offer in full:

"The remaining $10 million balance will be paid out to some 30 million one-pound shareholders (over 30 US cents per ordinary share). Payment of this $10 million from the US will occur during the next four weeks after two small hurdles – the first being clearance of the US withholding tax, and the second confirmation that the recipient is a legitimate ANC Plc shareholder entitled to receive this dividend. Subject to 2022 February AGM, ANC Plc’s shareholders will be asked to vote on a final dividend from this transaction which after taxes should amount to a further $15 million or 45 US cents per ordinary share, payable in February 2022. At the February AGM, ANC shareholders will be given alternatives as to the possible sale of the remainder of ANC Plc’s intellectual property (conceptually valued at more than £25 million).

A shareholder who contacted us tonight commented: "Frost seems to have forgotten that in the last sale of the "air-to-fuel" IP, he claimed that he, Jennings and Short were entitled to the first $30M. From the May 31st newsletter: 'Dr. Glyn Short & family is due to receive some £8 million from these transactions. Dr. ‘Bob’ Jennings & family is due to receive some £9 million from these transactions. Martin Frost & family is due to receive some £13 million from these transactions ' What happened to that?"

Claims Avocet meeting is 'illegal' dismissed by chairman

by OUR BUSINESS UNIT

Suggestions that this week's planned late night meeting by video link of vetted Avocet Natural Capital shareholders is unconstitutional and should be cancelled have been swept aside today by Group chairman Martin Frost.

On September 23rd Mr Frost issued a notice to Avocet's long suffering stakeholders that the first company meeting in two years would take place this Thursday at 9.15 pm in order to accommodate 'mystery' investors called PCH based in the USA. It has been claimed by dissenting voices that PCH Holdings and their UK representative Tim Carter simply do not exist.

Mr Frost also circulated an agenda for the September 30th meeting. He said shareholders will be asked to vote on the election of Directors; the appointment of Auditors; the drafting of accounts; the issuance of a Dividend; review of the Directors Report; and review of proposed litigation. 

Then recipients of Mr Frost's email were told: "Any legitimate ANC Plc shareholder who wishes to attend and / or vote at this video G M will need to email [Avocet director] Dr. Bob Jennings on Tuesday 28th September 2021 between 9 am & 4 pm UK time.

"Video links together with voting slips shall be issued by 12 pm UK time on Wednesday 29th September. Draft ANC Plc accounts will be issued to all ANC Plc shareholders on Wednesday 29th September. The Directors Report will be issued to all ANC Plc shareholders on Wednesday 29th September. Details of the proposed dividend will be issued to all ANC Plc shareholders on Wednesday 29th September. Review of proposed litigation will be issued to all ANC Plc shareholders on Wednesday 29th September."

But this set of proposals was attacked over the weekend in contributions posted on the independent Avocet Shareholders' Forum which poses the question 'Where has your money gone?'

One writer claimed: "This Notice is seriously deficient in three critical ways:

"1- Section 33.1 of the Articles of Association states, “An annual general meeting shall be called by at least 21 Clear Days’ notice.” “Clear Day” means that the day on which the event takes place as well as the day on which notice is received are to be excluded.

"Frost has given the shareholders only six Clear Days’ formal notice in direct violation of the Articles.

"2- Under “General Meetings", Section 33.3 of the Articles states, in part, “…the notice shall be given to all Members ….and to the Directors and Auditors, and there shall appear with reasonable prominence in each such a notice a statement that a Member entitled to attend and vote is entitled to appoint a proxy or proxies to attend and on a pool, vote instead of him and that a proxy need not be a Member.”

"Frost’s September 23rd, 2021 Notice does not contain this mandatory and important statement, in clear violation of the Articles.

"3- Section 42.1 of the Articles states, “Any notice of a general meeting must specify the address or addresses (proxy notification address) at which the Company or its agents will receive Proxy Notices relating to that meeting or any adjournment of it.

"I call on Frost to correct these serious deficiencies. If he insists on proceeding as planned, if subsequently challenged, there is a high risk that because of these serious deficiencies the meeting will be declared improperly constituted, and any votes taken at the meeting declared invalid."

However, in a hard hitting response issued today, Mr Frost declares: "Despite rumors and moves to the contrary. Be advised that as planned ANC’s Thursday’s video General Meeting is proceeding.

"Legitimate ANC shareholders can discuss the interim ANC dividend which ANC Plc directors have mandated. you have the right to attend this Thursday and express your views. A representative of PCH, whose colleagues have secured much information will be attending this meeting."

A success born out of failure

by BUSINESS STAFF

As administrators of the doomed Dawson International Group of textile and knitwear businesses continue the process of winding up and dissolving the failed giant, a survivor of the mayhem which engulfed a vital Borders industry a decade ago continues to prosper.

Back in 2012 at the time of Dawson's spectacular collapse strong fears were being voiced over the possible fate of Hawick based Barrie Knitwear and its workforce of 176 which had been producing top of the range cashmere garments for iconic French fashion house Chanel.

But it was Chanel themselves who saved the day by purchasing Barrie - founded in 1903 - in a £4.8 million deal with the Dawson administrators. The price, which was not disclosed at the time, looks to have been a real bargain given subsequent events.

Today Barrie continues to manufacture premium cashmere goods for the world's leading fashion brands with 266 on the payroll, consistent profits and a healthy order book.

However, the latest set of accounts show Barrie has not escaped the ravages of Covid-19, and there are concerns over the fall-out from Brexit.

The figures for 2020 show turnover at £16.298 million (down £2.449 million or 13 per cent on the 2019 total of £18.747 million. As a result last year's operating profit of £604,000 was considerably less than the £1.178 million recorded the previous year.

The company's report says turnover fell due to lower demand following the Covid outbreak. There was a five week halt to production which impacted manufacturing efficiency.

"The company welcomed the announcement of a trade deal between the UK and the European Union meaning there are generally no tariffs on goods traded between territories", adds the report. "Nevertheless, there remains a risk to the business from additional bureaucracy for the company and its customers seeking to move goods across borders. The economic implications resulting from the impact of Brexit are largely beyond the control of the company".

In a section covering the effect of Covid, Barrie's directors explain: "Following a strong start to 2020 the pandemic had a significant impact on the business, resulting in the temporary closure of production facilities and boutiques of our customers worldwide. There has been no use of government support schemes such as 'furlough'.

"The full financial impact of the health crisis is impossible to predict with a high degree of certainty. Our production facilities and boutiques are open and operating in accordance with local government guidelines. Furthermore, we have seen a good increase in orders from customers since summer 2020 and for 2021 are forecasting a return to similar levels of turnover and profitability experienced prior to the pandemic.

"The company continues to have a strong balance sheet and benefits from the support of its parent Chanel Ltd."

Barrie, with production centres in Hawick and Arbroath, reported an annual wage bill of £7.3 million for 2020. The sole survivor from the Dawson wreckage continues to flourish.

Meanwhile administrators of Dawson companies which once employed 12,000 people and whose presence was inextricably linked to the economic wellbeing of the the Scottish Borders, have produced their latest 'progress reports' on the administration procedure with the end of the saga apparently in sight.

Dawson's core business was also in cashmere which expanded significantly in the 1960s. A programme of diversification in the '70s and '80s fuelled growth in the UK and in the USA and saw annual turnover reach £400 million.

But problems flowed from the acquisition of businesses in the US, sharply reversing the fortunes of the textile giant, according to insolvency experts.

A report produced shortly after the administration began includes the following: "In 1986 a shower curtain manufacturing business was acquired and in 1989 an apparel business was purchased. These businesses were disposed of at significant loss in 1994.

"Compounding this problem, the textile industry, and in particular the cashmere industry developed in China and eroded the margins the (Dawson) group was able to generate in its businesses. Over the period 1999 to 2011 most of the group's businesses, including Todd & Duncan, Pringle and Ballantyne were sold to repay debt".

By 2012 the group comprised a UK knitwear business, Dawson International Trading Ltd., and a US sourcing business, Dawson Forte which brought Chinese-made cashmere goods into the States for local retailers.

But as the administrators make clear, the major issue for insolvency was the UK pension scheme liabilities and associated costs. In the years leading up to 2012 the combined deficit was fluctuating between £5 million and £30 million annually. It had reached £129 million when the administrators moved in.

Documents show the pension scheme actuary served contribution notices for the £129 million - the full buy-out deficit of the UK schemes - on the company.

"The directors concluded there was no alternative to appointing administrators for both companies". By now Barrie Knitwear was the only operational part of Dawson's once vast UK textile and cashmere operation. 

Avocet's 'jetty' company in hands of administrators

by EWAN LAMB

Avocet Faculties Ltd., the company which paid £200,000 for a dilapidated Loch Lomond jetty five years after the pier changed hands for just £1,000, is now in the hands of administrators from the  insolvency practice which is liquidating another business from the 'disruptive technology' Avocet group.

The jetty and a narrow strip of land at Port A Chaipuill, Arrochar has been used as security for a loan the £1 company had arranged with Avocet Infinite PLC (now called Omega Infinite and in compulsory liquidation).

A separate financial arrangement between the two firms entitles Omega to all of Faculties' properties and intellectual property including patents.

When shareholders discovered details of the £200,000 jetty purchase, which took place in October 2017, there was strong criticism of Faculties' management - current director Dr Bob Jennings, and his colleague Martin Frost who resigned from the Board in September 2020 at the time of Dr Jennings' appointment.

        

    The pier at Port A Chaipuill, Loch Lomond, bought in 2017 for £200,000

The files of Scotland's Land Information Service [LIS], a government agency, gives values for previous transactions involving the Loch Lomond jetty. It was bought for £2,000 in April 2008 before being acquired by a new owner for £1,000 in October 2012.

Documents posted on the Companies House website shows the appointment of joint administrators to Faculties by the Business and Property Courts in Leeds on September 14th. The insolvency practitioners are Kris Wigfield, from Begbies Traynor, Sheffield, and Jason Ainge from the company's Leeds office. Begbies are liquidators of Omega Infinite.

The company records also show that ownership of Avocet Faculties has changed hands several times since its formation when it was called Avocet Infinite Properties. According to the latest confirmation statement in August 2021 the single share was in the hands of Avocet Bio Solutions Ltd., which has an address in Lapp's Quay, Cork.

Avocet Faculties' last published accounts (for 2019) show total fixed assets of £815,823 including investment property said to be worth £565,823. The amount owed to Omega Infinite is given as £807,563.

In July of this year an Employment Tribunal judge ordered Avocet Faculties to pay a total of £9,588.80 to former office administrator Sarah Shotton who successfully claimed for unauthorised deduction of wages, for a breach of her contract of employment, and for unfair dismissal.

The tribunal has yet to fix the amount of compensation Ms Shotton is entitled to for unfair dismissal.

Earlier this week, in a newsletter to Avocet investors, Group chairman Mr Frost referred to "the current attempt by Begbies to bankrupt Dr Bob Jennings for £1.25 million because [a] Bob helped develop the Avocet concept, and [b] Bob gave to Avocet much of Avocet's patent strength".

In addition, Mr Frost stated: "The dirty behind the scenes attempts by solicitors acting for Begbies and Emma Porter (administrator of insolvent Avocet subsidiary Orrdone Farms Ltd) to steal the IP [intellectual property] money which Avocet IP Ltd. (another subsidiary) is shortly to receive.

"These lawyers, without due enquiry, poo-poo Avocet Infinite PLC's February 2019 Declaration of Solvency and the resultant demerger of Avocet Natural Capital and Bio Solutions".

 

£13.3 million claim dismissed as 'fantastical'

SPECIAL REPORT by BUSINESS STAFF

Avocet Group chairman Martin Frost, now awaiting the outcome of a bankruptcy court action, has circulated documents outlining a counter claim for more than £13 million in which he blames the  creditor and an administrator of one of his insolvent companies for loss and damage of valuable articles and property.

But Mr Frost's summons against United Kingdom Agricultural Lending Ltd (UKALL), and administrator Emma Porter, which was not accepted by Scotland's Court of Session received short shrift from UKALL's barrister when it became an issue for debate during last week's bankruptcy hearing at Leeds Business and Property Court.

Jonathan Rodger, counsel for UKALL who are pursuing Mr Frost and his wife for a £4 million loan debt, told the court: "Across the board Mr Frost's allegations are fantastical. There is an allegation that an officer of the Court colluded with the petitioner to steal £13.3 million worth of items including a Titanic Certificate of Sea Worthiness said to be worth £13,000.

"These are preposterous allegations. Mr Frost's evidence is hard to follow, it includes extraordinary allegations and is designed to confuse and to obfuscate, to raise a cloud of dust to create an air of substance when there is nothing there. He makes spurious allegations of fraud and forgery against officers of the Court".

But only a few days after proceedings at Leeds were concluded Mr Frost sent shareholders of Avocet Natural Capital full details of his cross claim. 

According to Mr Frost: "Legal actions...are to be brought against many parties. Enclosed is a draft Scottish Debt Summons I wished to bring against UK Agricultural Lending Limited and Ms. Emma Porter. As noted above, jurisdiction for this was refused by the Scottish Courts – happily in exchange for a £10k fee, and a purchase note of assignment, the English courts are pleased to process.

"On Saturday 18th September, Martin and Janet Frost under conditions, jointly sold their entitlements under this Summons to a third party. Same third party has translated the Scottish Summons into English High Court Writs against UKALL & Porter along with officers of Begbies Traynor [liquidators of another Avocet Group company, Omega Infinite]".

In a decision issued in December 2006 it was revealed that " the Lords of Council and Session, upon a petition by the Lord Advocate, have, in terms of section 1 of the Vexatious Actions (Scotland) Act 1898, ordered that no legal proceedings shall be instituted by Martin Frost, residing at ---- in the Court of Session, Sheriff Court or any other inferior Court unless he first obtains leave of a Judge sitting in the Outer House of the Court of Session, having satisfied such a Judge that such legal proceedings are not vexatious and that there is a prima facie ground for such proceedings" That vexatious litigant order on Mr Frost remains in place.

According to Mr Frost's summons: “The photographs (accompanying the claim) illustrate the way in which the second Defender [Ms Porter] in the best tradition of Robert Mugabe invaded the Pursuer’s properties, then brutally arranged for the dumping, burning and theft of the Pursuers goods. As is narrated below, the second Defender was ‘uncivilized’ in her disposal of Frost contents prompting losses of more than £10 million pounds.”

"And Begbies with the assistance of the second Defender subsequently moved over 500 items from Harcarse [a property formerly occupied by Mr Frost] to Begbies warehouse in Scunthorpe. List B in the Productions, prepared by Begbies, displays many of the above Frost mentioned items e.g., the Hingley Anchor Proving Certificate, some of Lutyens drawings for the ironwork on the Viceroy’s House, New Delhi etc. etc. – all missed on the second Defender’s valuation. Items missing include Titanic memorabilia: The Sea worthiness certificate of the Titanic; Various Titanic photographs, mainly of the manufacture of Titanic parts at Hingley’s and in Belfast. A Titanic crockery set inlaid with the White Star line (presented to Hingley’s directors’ wives at the Titanic launch)."

To back his claims Mr Frost adds: "Between December 2015 and December 2020 various prominent persons stayed at Harcarse Hill farmhouse who saw all or part of the above-mentioned items. Such persons include Dr. Farooque Dawood (whose family owns some 40% of Pakistan’s private economy); the Hon. James Willoughby barrister & landowner; Fieldfisher solicitors Mr. Kit Jarvis & Mr. Tim Bird; Dr. Glyn Short; Professor Geoff. Randall; etc, etc."

Avocet Natural Capital (ANC) investors are told that over the last few days there have been intense meetings "to stop inspired bad & complex attempts by the lawyers acting for Emma Porter and Ashleigh Fletcher [Omega Infinite joint liquidator] to prevent your ANC dividend receipts. Happily, all apart from a possible US withholding tax query are overcome."

Mr Frost goes on to say that the Frost family is donating one million pounds to the crowdfunding entity being setup by his colleague Dr. Bob Jennings (a fellow director of Avocet entities).

Furthermore: "The Frost family is donating a further one million pounds to promote a commercial enterprise to offer third party finance which overcomes the difficulty a claimant might have in bearing the often-high costs of litigation. Further publications shall explain.

"The Frost family is donating ten million pounds to an Irish institution to seed corn finance the Avocet ‘hydroponics’ & ‘heathy [sic] beef’ concepts."

The many millions of pounds needed to finance the proposed measures will be raised, says Mr Frost, by the sale of the ‘Mayo Pot’.

"By arrangement, on Thursday 23rd September 2021 the ‘pot’ will be lodged with a Leeds solicitor. Subject to internal agreement, the Frosts have mandated its sale subject to an export license. Note: an Irish ancestor of my mother, Lord Mayo, basically stole it from a mate who had physically sacked China’s Imperial Palace during the Second Opium War.

"Some years ago, Sotheby’s valued the ‘pot’ at over £30 million – two similar pots have recently gone to Chinese collectors for over £40 million. In 2018 & 2019 the family discussed the ‘Mayo pot’ sale with accountants Ryecrofts, of Newcastle, who thought the wisest thing for the Frost family to do was to tax efficiently sell the ‘pot’. Bottom line if sold tomorrow one should expect net of tax and fees some £20 to £30 million depending on who turns up to the auction."

Bankruptcy hearing sets October 11th 'deadline'

EXCLUSIVE by COURT REPORTING STAFF

A judge hearing a bankruptcy petition against self-styled controversial businessman Martin Frost and his wife has given the couple until October 11th to produce evidence they can pay off a £4 million debt, said to be owed to a farm mortgage company, "within a reasonable time".

The two-day 'remote' hearing at Leeds Business and Property Court last week heard detailed submissions from legal counsel representing the Frosts and the petitioners, United Kingdom Agricultural Lending Ltd. (UKALL)

A 'last minute' cross claim from Mr and Mrs Frost seeking £13.3 million from the petitioners and from Emma Porter, administrator of one of Mr Frost's insolvent companies for damage and loss has not been accepted by Scotland's Court of Session, the hearing was told.

Judge Joanna Geddes had before her a thick bundle of documents linked to the case including four separate witness statements from Mr Frost. At the conclusion of proceedings the judge said she would hand down her judgment on October 18th.

Barrister Jonathan Rodger, for UKALL, told the hearing: "There are patterns of evasion in Mr Frost’s behaviour, and the late submission of this cross claim is part of that. Another spanner has been thrown into the works”.

Guy Olliff-Cooper, counsel for the respondents (the Frosts), made a number of submissions in an attempt to have the bankruptcy petition rejected.

On day one Mr Olliff-Cooper claimed  the creditor had not made enough of an effort to serve the statutory demand for payment on the Frosts. Several letters addressed to 25 Palace Street, Berwick [registered address for a number of Mr Frost's companies], were returned unopened by company secretary Eirlys Lloyd as the Frosts did not receive mail there and were not resident at that address. 

Then, said the lawyer, when the process server visited the couple's home in a Scarborough apartment block with demand documents these were posted through the communal letter box at the front of the building rather than via a side door leading to Mr Frost’s flat. They ended up 'in the bin'.

But in countering that argument, Mr Rodger said it was obvious why the server had gone to the service address of the debtor (25 Palace Street) and to the residential address at Belvedere, Scarborough. The purpose of these visits was to render personal service but that had not proved practicable as the Frosts were not there. 

He added: "After the door (in Berwick) was closed in the server's face the letter was posted through the letter box. The demand remained at Palace Street for some considerable time before Ms Lloyd posted it back to the server. This was a schoolboy attempt to evade service".

The second day of the hearing saw Mr Olliff-Cooper argue that there was no liability on the Frosts as the guarantees they signed when the original £3.25 million loan was made by UKALL were not enforceable. Until someone stated they would be bound by the terms of the guarantee the document was not a deed and was therefore not valid, according to the Frosts' counsel.

In response, Mr Rodger remarked “a desperate debtor raises facetious claims”. He told the judge: “You must consider the credibility of Mr and Mrs Frost’s defence...is it credible or a put up job?”

Although Mr Frost now denied there was any debt, Mr Rodger said that previously he seemed to accept responsibility for it in a series of emails dating from March 2020.

Quoting directly from the emails, Mr Rodger said Mr Frost had first written: “We shall reply with substantial proposals”. The following day he indicated “We are thinking of making an offer”, then a follow up email signed by Mr Frost and his wife suggested a payment of £2 million. And in an email written to his lawyer Mr Frost said: “My wife and I can manage £4 million.”

Said Mr Rodger: “That is a funny thing given that Mr Frost claims in this case there is no debt”. There had not been a ‘sniff of dispute’ in any of that earlier correspondence.

In a further submission Mr Olliffe-Cooper claimed this was a rare case in which the recovery of a debt was not the principal part of UKALL’s purpose. Bankruptcy would not be in the best interest of the creditors, he claimed. UKALL did not want to get back its money solely by pursuing the guarantors of the loan. If that had been the case UKALL would have pursued all of the guarantors of which there were six in total.

"There is another reason for pursuing my clients", said Mr Olliff-Cooper. "The real reason for this bankruptcy petition is to prevent Mr Frost from bringing the action (for £13.3 million) against UKALL".

Mr Rodger dismissed that submission as fantastical conjecture by Mr Frost.

Then in a forceful putdown of the cross claim, Mr Rodger declared: "“The fact that this document is produced on Wednesday of this week tells you all you need to know. The contents of this document are the ravings of a lunatic”.

Mr Rodger told Judge Geddes: "“The fact is the petitioner is pursuing the low-hanging fruit. Mr Frost’s evidence is that he is of good standing; he is a multi-millionaire. It is incorrect to say this is the only action the creditor has taken. Not only has it pursued the Frosts, it has put the principal borrower [Orrdone Farms] into administration, and Harcarse Hill farm [a property in Berwickshire] has been sold. And there is no evidence Mr Frost has had £13.3 million of property stolen or destroyed”.

After Judge Geddes suggested October 18th as the date for her judgment, Mr Olliff-Cooper indicated that Mr Frost's financial situation could change markedly before then; his client could get £20 million paid into his bank account,

But Mr Rodger said there was no evidence to show that Mr and Mrs Frost could pay the outstanding debt.

Judge Geddes ordered that the Frosts must provide their evidence of ability to pay by October 11th.

No approach to Kwarteng for mystery investors' anonymity

BY OUR BUSINESS STAFF

UK Business Secretary Kwasi Kwarteng was not asked to afford anonymity to the mystery investors said to be willing to plough tens of millions of pounds into controversial businessman Martin Frost's array of companies, a lengthy investigation by Not Just Sheep & Rugby has discovered.

Shareholders in Avocet Natural Capital PLC and Genfro Ltd., both involved in the 'disruptive technology' sector, were told by Mr Frost that the secretive outfit he named as PCH Holdings and their UK representative Tim Carter wanted to protect their business activities from public view.

The initial reference to Mr Kwarteng's alleged involvement in a cover up to benefit PCH was made in a 'newsletter' from ANC chairman Mr Frost on July 29th after posts appeared on the Avocet Shareholders' Forum to the effect that PCH and Carter were both fictional. There is no contact address for PCH and the 'group' does not merit a mention anywhere on the internet, according to critics and doubters.

Mr Frost declared in his message: "The ‘mystery investors’ are known to some of Genfro’s prominent shareholders, its lawyers, but most importantly The Secretary of State for Industry Mr Kwasi Kwarteng who was approached to secure anonymity."

As we reported at the time, just two days later Mr Frost released the text of a letter supposed to have been sent by 'Tim Carter' to Sarah Munby, Permanent Secretary at Mr Kwarteng's Department for  Business, Energy & Industrial Strategy (BEIS) with the anonymity request for PCH.

The letter to Ms Munby stated: "Over the last three years, PCH has acted as a guardian angel to controversial Anglo-Irish businessman Martin Frost who promoted Avocet Natural Capital Plc.

"To keep ANC Plc alive & protect its valuable intellectual property PCH is responsible for: Over £2 million pounds of gift life support funding; Liaison with colleagues who control the ownership of the Israeli Leviathan and Tamar gas fields which prompted a $100,000 US dollar offer to ANC’s subsidiary Avocet IP Limited for its old AFS jet fuel from air patents. Due to ANC Plc stupidity, this transaction failed though a reduced-price deal of $30 to $40 million is in the offering."

'Carter' goes on to claim that because of "SNP [Scottish National Party] inspired badness" PCH decided it was wasting resources attempting to support a company focused out of Scotland. PCH thus encouraged Martin Frost and his colleague Dr. Bob Jennings to set up a completely new entity, Genfro Limited. 

"For strange reasons of sentiment Frost & Jennings then gave away options for chosen others to obtain Genfro equity at humongous discounts. These gifts and their domino consequence have angered PCH. PCH would like Genfro Limited to be owned by people of like minds to PCH."

Ms Munby was also told: "Presentably, PCH has funded four provisional patents of which one for a non-explosive methanol additive to allow green methanol to become a clean replacement diesel is the most valuable. PCH is about to fund a further 30 more fuel and agricultural patents which should result in Genfro Limited becoming a £200 million IP company.

And according to 'Carter': "Down to ongoing perceived dishonesty infusing Scottish politics along with unjustified and apparently racially motivated SNP hate campaigns, PCH wishes to keep out of the limelight.

"Our understanding is that under UK company law PCH & colleagues can retain anonymity providing we keep our respective overseas shareholdings below the 25% threshold. Please confirm promptly if our understanding is correct: if not I regret PCH will not invest in the UK." 

We asked BEIS to tell us whether the Secretary of State had made an order to secure PCH's anonymity. Our initial request for information was directed at the Department's press office, but we were then redirected to the general Enquiry Unit.

Finally, this week the following response was received from BEIS: "Thank you for your emails dated 30 July onwards, to the Enquiry Unit, about matters surrounding investors in Genfro Limited. I have been asked to reply and apologise for the delay in doing so, it has taken time to undertake the comprehensive search of our records required to accurately respond to your enquiry. 

"You asked whether the Secretary of State had been approached with a view to securing anonymity for certain investors in the company and, if so, whether such anonymity had been granted. We have searched our records and can confirm that no approach in such terms has been received by the Secretary of State."

The disclosure prompted a strong reaction from a shareholder in the Avocet companies who told  us: "While many have long suspected that Frost has continuously misled investors, it is still very shocking for me to see absolute proof of it!

"This means, of course, that the 'mystery investors' do not exist, so the promise of a premium-priced share offer, massive investment, and their eventual purchase of all of Avocet’s IP [intellectual property], is simply all hokum. Misleading the shareholders of a public company is a serious, and could possibly be a criminal, matter."

And the irate shareholder added: "It is now abundantly clear that the shareholder letters Frost sent out in July concerning the request for anonymity were pure works of fiction”.