The companies, OFG Investments Ltd (OFG) and GIG Properties Ltd (GIG), marketed and sold plots of land on a former World War II airfield in Devon to members of the public.
Neither the companies nor the owner had the land valued before it was sold at mark-ups that were so substantial that the companies, by agreement with the owner, were able to retain more than 85% of the sales proceeds, the UK’s Insolvency Service said.
No planning permission
The investment was sold on the basis that the land was suitable for development.
The companies’ salespeople, website and brochures suggested that there was a reasonable prospect of being granted planning permission for housing and/or commercial development, giving a substantial investment return.
The actual position was that the local authority’s plan for the area would not allow such development.
Anthony Hannon of the Official Receiver’s Public Interest Unit, a specialist Insolvency Service team that investigated the scam, said: “While land can be a viable investment, it should have been clear to the directors from the local authority’s published plan that there was no likelihood of planning permission being granted at the location, and so there was no viable exit strategy for the so-called investments.”
Hannon said the company was “run entirely for the benefit of the directors, at substantial cost to the investors who had been misled and have lost their money in what was never a realistic investment”.
Disqualified
Mehmet Husnu (also known as Matt Hudson) and Ali Seytanpir (also known as Alex Townsend) were disqualified following the Public Interest Unit’s investigation.
They found that, between December 2010 and December 2011, the companies made sales of £2,209,296.
Payments totalling £1,337,935 were made to Husnu, Seytanpir and a relative’s company in Cyprus.
Husnu has been disqualified for 14 years, effective from 12 January 2017, while Seytanpir was handed a 12-year ban, effective from 15 March.
“The lengthy periods of disqualification in this case show that this kind of behaviour will not be tolerated by the Insolvency Service,” Hannon said.
