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b eak vision
Page 28
Page 29
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A group of subcontractors face possible bankruptcy after a freight forwarder ceased trading, owing them
mone/ Dominic Perry reports on the fallout.
The creditors of defunct Leeds-based freight forwarder Vision Logistics International (VU) say they feel angry and let down by its collapse which has left them an estimated £250,000 out of pocket. Some VL1subcontractors,the majority of whom are owner-drivers,could be forced into bankruptcy and face losing their trucks or even their houses.
The subcontractors are anxious to know where their money has gone. It appears that VLI was factoring its invoices — in effect getting money for work undertaken up front, while subcontractors were paid a month in arrears.
Some had been paid roughly up to date while others were roughly two weeks behind. But all of them are also owed about a month's money that has not become due yet. Devon owner-driver Clive Mugford says he is out of pocket by almost £35,000 and had just bought a new truck on the strength of the VLI work.
Lots of promises
He adds that despite repeated promises to put almost £20,000 into his account in the week leading up to the collapse nothing was done. He was even faxed copies of BACS statements showing over £9.000 had been transferred into his account on 6 August, but the money never arrived. In the meantime, reassured by VLI's comments, he continued to pull loads for them. He says: "That's me virtually finished and bankrupt because of them. My fuel cards have been stopped and my truck is parked up. I'm just finished."
Another subcontractor, Ilkley-based Tony Williams, says he is angry that work continued to be given out in the run up to VLI's collapse, leading subcontractors into greater debt: "I went in to the office on the Wednesday prior to them going bust and they never said a word."
Additionally the creditors are asking a number of questions of the firm's management. who seem to have offered unconvincing or contradictory explanations for its sudden demise.
The firm ceased trading on Friday 13 August: Peterborough-based accountants Elwell, Watchom & Saxton has been appointed to organise a creditors' meeting on 2 September with the aim of putting the firm into liquidation.
VLI began trading in March 2002: it was formed by directors Andrew and Christopher Cantriillhe firm was effectively a spin-off from another of the Cantrill's firms, Vision Foods, and was launched with the intention of transporting that company's food products around the country However, although this remained a key part of the business, VU quickly developed a freight forwarding operation, arranging for around 26 subcontractors to undertake work for third party transport and logistics firms including Culina Logistics, Heritage International and ACS&T.
Much of the work was on the Continent, particularly Belgium and France, and this accounts for the relatively high debts amongst subcontractors: they're owed an average of about £15,000 each.
According to Companies House records VLI seems to have struggled financially from the outset. As recently as September last year the company admitted to a cashflow problem (CM 25 September 2003). And accounts dating from October 2002 warn: "At the balance sheet date the company was insolvent. The continuation of the company's activities is dependent upon the continued financial support of the directors and this support has been guaranteed by them for the foreseeable future." However, the accounts give no indication of the firm's turnover or profit/loss.
There appears to be some confusion as to why the company has been forced to close. Statements released to subcontractors merely refer to "administrative problems" and hint at conflict within the firm (see panel).They also say that MD Christopher Cantrill has lost over £200,000 through the collapse.
An earlier letter to subcontractors from the firm dated 5 August appears to point the finger of blame at an unnamed ex-employee. It states: "It is regrettable that you may have had conversations to the contrary or that allude to other matters or past persons that have been involved in our business. Regrettably, due to other problems this individual has caused directly on the infrastructure of our office, we are experiencing a delay in being able to pay, invoice and receive payments into our business."
However, the letter goes on to promise that VU I was making every effort to sort the problem and predicted that the business would "be back to normal next week".
The ex-employee in question appears to be Brian Bett, who was formerly in charge of VLI and left the firm several weeks before its closure. An e-mail passed to CM by one subcontractor and dating from December 2003 purports to be from Bett to MD Christopher Cantrillit seems to confess to mismanagement at the firm, specifically creating false invoices, even suggesting that the e-mail should be passed to the police as evidence.
Genuine or smear?
At one point it reads: "I am a coward of a man, Chris. I should have told you all this.The truth is I know this may tip you over the edge and I really am physically scared of what you will do to me when you read this." It is impossible to tell if the e-mail is genuine or an attempt to smear Bett — he vehemently denies the allegations. He adds:"All 1 have done is to leave the company when! wasn't wanted."
The provisional liquidator says it is too early to say what level of debt the firm has, nor what forced it to seek liquidation.
Christopher Cantrill declined to comment, apart from reiterating that he had personally lost money on its closure and could no longer afford to subsidise the firm. •