Unregulated New Earth funds facing liquidation

Added 17th June 2016

Joint liquidators have been appointed to the New Earth Group of Funds following an application by the Isle of Man Financial Services Authority (IOMFSA). The application was made with the knowledge and consent of the funds’ directors.

Unregulated New Earth funds facing liquidation

On 9 June the High Court of Justice of the Isle of Man ordered the provisional appointment of Sarah Sanders and Alex Adam of Deloitte as joint liquidators.

A further hearing is scheduled for 12 July 2016, at which time the court will determine whether or not the company should be placed into liquidation.

The New Earth Group of Funds offered three collective investment schemes:

  • New Earth Recycling and Renewables (Infrastructure) (NERR), an Isle of Man specialist fund;
  • Premier Investment Opportunities Fund (PIOF), an Isle of Man qualifying-type experienced investor fund; and
  • Eclipse Investment Fund, an Isle of Man qualifying fund investing into NERR.

Debt and losses

IOMFSA’s application relates to the position of two companies into which New Earth Group are almost wholly invested.

“It therefore remains unlikely that the sale of these assets will generate a return for the fund.”

NERR is the majority shareholder of two entities: waste treatment services firm New Earth Solutions Group (NESG) and New Earth Solutions Facilities Management (NESFM), which focuses on projects to recover low carbon renewable energy from waste derived fuels.

Financial statements for NESG and NESFM posted on the Channel Islands Securities Exchange on 20 May 2016 show large debt positions and operating losses. 

NERR, along with NEFM and NESG, has been working for over 12 months with a developer to save the two companies and achieve shareholder value for the New Earth Group of Funds.

However, on 26 May the directors of NESG and NESFM filed a notice of intent to appoint an administrator with the High Court of Justice Chancery Division in England and Wales. As UK companies they sit outside the remit of IOMFSA. Duff & Phelps were duly appointed.

Companies sold, investors lose out

In letters to NERR and PIOF shareholders dated 16 June, the manager of New Earth Group, The Premier Group, advised that “the New Earth Group of Companies have sought statutory protection by filing notice to appoint an administrator. The administrator has moved quickly and has sold [NESG and NESFM] to DM Opco, the full details of which are unknown.

“Taking into consideration that the assets of NERR are largely subordinated to the senior lenders’ debt, the directors consider it unlikely that the sale of these assets to DM Opco will achieve over and above the amount of senior lending.

“It therefore remains unlikely that the sale of these assets will generate a return for the fund.”

Unregulated, non-retail funds

Specialist, qualifying and qualifying type experienced investor funds are unregulated collective investment schemes which are not approved or reviewed by IOMFSA. Once launched the funds must be registered with the authority within 14 days.

These types of funds cannot be sold to the retail public.

Access to such funds is only available where investors confirm that they meet the fund type’s minimum entry criteria. This includes a statutory certification that they have read the scheme’s offering document and understand and accept the specific risks associated with that type of fund.

IOMFSA’s remit for such schemes is to register, receive notifications of changes, and supervise their appointed Isle of Man functionaries. 

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Terrible Advice

It seems we are not the only ones to be given bad advice. Prosperity (http://www.prosperity.ae) advised us to invest in this "low risk" investment. We were using this money to pay for our house to be built but have now lost every penny. Not only was the company mismanaged but the advice from certain investment companies was totally wrong. I want anybody who is thinking to go with the above named company to think again before taking their advice.

Posted by: Paul, 11 Jan 2017


Empathise with the people below. I lost the equivelant of over 300,000 Sterling on this. Is there any updates at all about how the Liquidators have handled it?

Posted by: Stephen, 21 Dec 2016


We also invested £40,000 in what we thought was going to be a long term Trust Fund for our two grandchildren to help ensure their future. The value rose to £55,000. The fund was then frozen and we were told the company was being sold and not to worry as there will probably be a bonus paid. It has now taken two years to be told the company was in trouble. I contacted the IOM Ombudsman who told me that investment in this sort of company was for larger businesses and that we should never have been advised to invest our money and that we will not get our money back, so why did Premier take our money?? We are pensioners and this is a great loss to us. We are very upset and angry

Posted by: C Treeby, 11 Sep 2016


We invested £40k in a trust fund for our two grandchildren for their future. "John Banks" - your comments and advice experience are identical to ours. IOM Ombudsman told me we should never have been advised to invest in this sort of Company as it was not designed for the small shareholders and that we will not get our money back. Too many larger investors will come first if there is anything to be had. We do not understand how we were told the business was doing well but our funds had also been frozen for two years prior to this badly managed company. As pensioners we are very distressed at such a loss.

Posted by: Chris & John Treeby, 10 Sep 2016

Badly managed

i invested 50k with Premier new earth in 2009,and in 2013 the value of my shares was 71k. I tried to redeem my shares but I was rejected, in the last 2 years I have been in touch several times with the fund manager who said nothing to worry about things are going ahead ok, then on June 9th the company goes into liquidation, very badly managed, also I have found out that my financial advisor is not regulated, why did premier let him invest our money.i have been in touch with the fsa in the IOM they don't seem bothered.

Posted by: John banks, 02 Aug 2016

A disgrace

Totally agree. I am sure the directors have taken their money and left fund holders which does include retail investors picking up the losses due to their incompetence or malfeasance

Posted by: Mike Baker, 27 Jul 2016

A disgrace and possibly illegal!

This is awful, the directors have acted beyond their remit and shown themselves to be incapable, they should be disqualified and sued for damages.. It is their fault this ended up like this and have to take responsibility.. The regulator has to investigate this, it is a total sham and I am still shocked that a company da be sold by administrators within 2 days without someone acting improperly..

Posted by: Paul, 18 Jun 2016

About Author

Kirsten Hastings

Senior Reporter

Kirsten is a senior reporter for International Adviser, covering global news stories about the financial services industry. She joined Last Word Media in October 2015 after two years working as a reporter covering the staffing and recruitment industry. Kirsten has a Masters in Financial Journalism from the University of Stirling. 


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