Creditors follow SWF trail of confusion
Page 10
If you've noticed an error in this article please click here to report it so we can fix it.
• by Melanie Hammond
Last week CM revealed that the procedures carried out by PallEx (UK) to vet potential new members had failed to weed out problem companies in South Wales (CM15-21 Feb).
Pall-Ex membership in South Wales had changed hands five times in less than four years after three companies hit financial difficulties and one was deemed to be a threat to the Pall-Ex brand name.
The latest member to take on operations for Pall-Ex in South Wales has now been exposed as being run by Trevor Taylor who was declared unfit to act as a director until August 2002 (see page 4).
Alerted
CM was first alerted to problems with Pall-Ex's South Wales operations when a reader suggested we take a look at the SWF group which recently went bust for about £250,000.
Subsequent investigations raised some serious questions about Pall-Ex's vetting procedures and the circumstances surrounding the failure of the SWF group.
The group comprises:
NI The Impact Group (the group's holding company);
• SWF Management; • SWF Distribution; • SWF Logistics: • SWF Transport; • SWF Forwarders.
Companies House records revealed that one of the directors of the holding company, Anthony Lewis, had a history of failed companies. CM can now reveal further details about SWF and why creditors are threatening to sue.
Trailer leasing giant Lex Transfleet claims it is owed £196,000 by SWF companies SWF Distribution and SWF Transport. While the amount is disputed, company accounts show that Lex is the biggest creditor.
Lex has now put the matter in the hands of its lawyers who are considering whether they can sue the holding company directors, Lewis and Philip Barnett.
At a recent creditors' meeting, Lex alleged that SWF had tried to buy time on payments by presenting a document which the directors knew to be out of date.
After running into problems with factoring firm RDM, Lewis and Barnett approached American firm 0-MAC to refinance the company. Lex asked why papers in connection with this request to 0-MAC were presented to them (Lex) on 14 November 2000 when SWF had reportedly been turned down by 0-MAC 00 26 October.
At the meeting, Lewis responded: "That's absolute rubbish. We produced that document in August." He also maintained that they were always open with Lex about their cashflow problems.
Recently, Barnett said: '`GMAC was very much in the frame as a refinancing vehicle at the time." He says it was his decision not to go ahead with a deal: But we were continuously and genuinely trying to refinance the business."
Lex also queried why Lewis and Barnett had signed the papers under the company name SWF Group Ltd, which was not usually associated with their company. Lewis said this was simply a mistake by 0-MAC which produced the papers.
At the meeting, Lea's representative Sue Clay also referred to "a nightmare level of intercompany transfers". Barnett agrees that the group had a "complex structure" but says transfers between the companies were to be expected.
The creditors' meeting also revealed anomalies in a set of SWF's accounts with a contingent liability of £358,000 shown in the assets column. However, Barnett says that this has now been reconciled and that the liquidators can confirm this.
Confused
Lex is not the only creditor which was confused by the company's structure. Tony Davis, MD of Bristol-based Secure Cargo Assured, says he assumed he was dealing with SWF Forwarders but became confused when further correspondence came or paper headed South Wales Forwarders.
The director of creditor Sully-based trailer hire, sales and repair firm PADS 86 Co (owed just under £6,000) says he is keeping an eye on future developments.
In December, he received a credit application from Martin Moloney of Road Air and Sea Freight Forwarders. The application for credit included an insurance document relating to South Wales Forwarders.
Moloney says he was a director of SWF Forwarders until last October and was also a director of Lewis's previous companies, Al Premier Warehousing and Al Premier Warehousing and Distribution. However, he insists that despite being based at SWF's former premises in Treforest Industrial Estate, his current venture, Road Air and Sea Freight Forwarders, is in no way connected with SWF or Lewis and Barnett.