In making the order to wind-up the companies (Chapeltown Associates Limited, Highland Properties Estate Agency Limited and Osprey Highlands Estate Agents Limited), Registrar Jaques condemned some of the companies' practices as 'unsatisfactory' and 'unacceptable'.
The investigation by the Insolvency Service's Companies Investigation Branch ("CIB") found that land being offered for sale at Loch Shin in Scotland had initially been marketed to the public by a company called IDC Land Limited controlled by a Mr Brian James O’Brien.
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The scheme, called 'landbanking', involved selling plots to investors on the basis that planning permission was very likely to be granted resulting in a substantial increase in value. In fact, there was no likelihood of planning permission being granted.
IDC Land Ltd managed to persuade eight clients to part with in excess of £220,000 for land which it did not even own.
IDC was wound up in the public interest in May 2008, Highland Properties Estate Agency Limited and Osprey Highlands Estate Agents Limited continued to market the land, which had been acquired by Chapeltown Associates Ltd, but again there was no likelihood of planning permission being granted so as to add value to the plots of land that were marketed.
On hearing the evidence, Registrar Jaques ordered all three companies into liquidation in the public interest.
Robert Burns, Head of investigations and Enforcement at the Insolvency Service said: "Some companies exploit land banking as a means to induce investors to buy land on the promise of high returns which may never materialise. We will continue to crack down on companies and individuals which deliberately mislead the public in this way.
"I'd encourage anyone approached by companies offering plots of land on the promise of future planning permission to be on their guard."
(GK/KMcA)
