George
6 weeks ago we heard from David Southwell
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On 2 July the court order was continued by consent.
We are working to attempt to resolve the regulatory issues identified by the FSA.
The Court order prevents us from making repayments, or payments of interest, to loan clients, because the FSA is concerned that the Midas companies may be unable to meet all such obligations. However, we have agreed to create a segregated account for each Midas Company and to use our best endeavours to pay into those accounts capital and interest as it falls due. As you will understand, the Court Order has stopped us from progressing new lenders and those that were in progress, although we hope that this business can be resumed if we can produce a mechanism satisfactory to the FSA. We have suffered from a shortage of cash and will not be in a position to make payments into those holding accounts immediately. We are confident that we will be able to do so if we can resolve the regulatory issues raised by the FSA.
We intend to provide the FSA with a revised business plan within the next three weeks. It is our intention, as stated above, to include a new regulatory compliant loan product in this business plan. The details of this product are currently being finalised by our legal advisors and it will be shown to the FSA before it is offered to clients. This should provide us with a new means of raising finance as well as the opportunity to offer current lenders the choice of switching their existing loans to the new product, or being repaid their capital and paid their interest within a specified time frame.
Our asset position has been greatly enhanced this week by the granting of the final piece of planning consent for our Peninsula Village development at Izmir in Turkey subject only to a one month ‘hanging period’ during which objections can be made, however we have been advised by the Mayor of Mordogan that the proposed development is of such benefit to the area that the Planning Department cannot see any such objections if received having any merit to stop the development with its widely accepted benefits regarding tourism, jobs and general financial improvement to the local community. We are awaiting an updated valuation but have been assured that with planning consent, the value of the Peninsula land will have appreciated very substantially.
Midas hopes that its continued co-operation with the FSA will lead to a prompt resolution of the outstanding issues, enabling the resumption of uninterrupted business and repayment to loan clients within 6-8 weeks from today.
Finally, can we just remind you that this situation is not of our making, and that we took expert advice on our loan products early last year. We are considering, with our current legal team, what action we might be able to take in respect of that advice."
It is 6 weeks today