The wife of the man at the centre of the scandal, Helen Hume-Kendall, is said to have spent £250,000 on membership of Annabel’s, one of London’s most famous nightclubs.
It is alleged she and her husband received around £24million of bondholders’ cash.
Her husband Simon Hume-Kendall is the Tunbridge Wells businessman who set up LCF. The firm collapsed in 2019 wiping out the savings and investments of more than 11,000 people.
The former chairman of Tunbridge Wells Conservatives, Mr Hume-Kendall set up the minibond company in 2012 and then went onto become its biggest borrower through his firm, London Oil & Gas [LOG].
LOG collapsed shortly after LCF went into administration, owing nearly £90million it had borrowed from LCF.
Administrators for LCF now want the cash back and are suing the couple along with 11 other people connected with the firm for £178million.
Among those also being sued by administrators for LCF, Smith & Williamson, are LOG director Elten Barker of Hadlow Down, LCF Director Andy Thomson, and Crowborough businessman, Spencer Golding – over allegedly defrauding investors.
Also being chased for money is former Conservative minister Charles Hendy – who was employed by Mr Hume-Kendall as a consultant and sat on the board at LOG.
Mr Hendy was elected MP for Wealden in 2001, and in 2010 he served as an energy minister under David Cameron.
He is accused of failing to take sufficient steps to discover the alleged fraud in his role as director of LCF-linked companies.
Mr Hendy denies any wrongdoing. He told newspapers: “This legal action against me is totally without merit. I will contest it in court as I always fulfilled all my responsibilities as an independent non-executive director.”
Smith & Williamson believe LCF was set up solely to defraud bondholders. They say money filtered from LCF through a web of interconnected companies.
The administrators claim that nearly 60 per cent of all of the investors’ cash — about £136million — was channelled to LCF’s executives either directly or via loans to companies they controlled or were connected to.
They say the allegedly fraudulent nature of LCF’s business was ‘concealed’ by a series of loans that purported to be ‘bona fide arms-length transactions’.
Among the bondholders to lose cash were a large number of retail investors who were induced to buy bonds for a failed hotel scheme in the Dominican Republic called El Cuype and a Cornish holiday park called Waterside.
Pradeep Oliver, partner at Tunbridge Wells law firm Cripps Pemberton & Greenish, which is representing El Cuype and Waterside investors, said the selling of unregulated investments to unsophisticated clients began ‘as long ago as 2010-2011’.
He added: “It is hoped that the action taken by the administrators will bring the individuals to account and provide clarity on the whereabouts of investor funds.”
Couple ‘strongly deny’ any wrongdoing
LCF was set up in 2012 by Simon Hume-Kendall under the name South Eastern Counties Finances.
Between 2016 and 2018 it hired Surge Group, a Brighton-based marketing company set up by former Tonbridge police officer Paul Careless, to attract new investors.
The new lawsuit brought by Smith & Williamson alleges that ten of the 13 individuals named ‘misappropriated’ bondholders’ money, including Mr Hume-Kendall and his wife, Helen.
A lawyer for the couple said they ‘strongly deny any wrongdoing and will be vigorously defending the proceedings’.
LCF collapsed after the Financial Conduct Authority froze its bank accounts claiming Surge’s marketing was misleading – investors thought they were purchasing bonds with returns as high as eight per cent and their money would be invested in legitimate businesses.
Mr Careless is also a defendant in the lawsuit with administrators claiming he ‘personally received’ at least £8.5million.
Simon Hume-Kendall, Elten Barker, Andy Thomson, Spencer Golding and Paul Careless were all quizzed by the Serious Fraud Office last year in relation to the collapse of LCF.
The investigation is ongoing, but nobody has been charged.
