Lexi administration receives two-year extension
KPMG’s administration of property lender Lexi Holdings is set to run for 10 years after the accountancy group extended its appointment until 2016.
It has been a complicated, yet lucrative case for the firm, which has involved freezing assets in Pakistan and taking legal action against some of Lexi’s former advisers.
So far KPMG’s bill for the work has reached £8.4million.
Lexi was a Manchester property lender which collapsed in October 2006 with debts to a banking syndicate of more than £100m, weeks after managing director Shaid Luqman received a 15-year director ban for his conduct in running another business, Modern Living UK.
Luqman fled the UK in 2011 while wearing an electronic tag after being found guilty of passport fraud offences. The police are also searching for his younger brother Waheed, having been jailed for seven-and-a-half years in his absence last January.
In a document filed at Companies House, KPMG said it needed the extra two years to: continue investigative work into misappropriated money; pursue legal action; continue to collect the Lexi loan book; chase for returns on property where Lexi has security; and deal with unsecured creditors’ claims.
Now in its eighth year, the administration has realised assets worth £42.3m – with £6.8m coming from negligence claims against Lexi’s former advisers – but this work has cost £28.6m. Lawyers have also profited outside of the case, charging around £13m in fees.
The Luqman brothers are believed to be in Pakistan with other family members. Court orders have now been issued covering worldwide assets worth £260m. KPMG said judgements have also been obtained against a further 15 related parties and associates.
Administrator Brian Green said:
“It’s just one of the most complex cases there’s been. On day one we turned up and there were very few books and records. We then took our time with lots of legal actions and these are still on going.”
“Alongside that we had a huge amount of property and we’ve sold the majority but some have taken time to work through because of the property market. It’s been unusual but it’s not a record breaker, there are some cases that take 20 to 30 years.”
“Is there a prospect of future significant recoveries? Yes, but that’s probably as far as I can go. But they [the creditors] always accepted it would be a big challenge to recover all their debts.”
Last year TheBusinessDesk.com discovered Shaid Luqman had launched a high-end fashion boutique called La Societe in Lahore, Pakistan.