Two companies have been forced into liquidation by the High Court after facilitating a “dishonest” land banking scheme.
One company was the land owner and another posed as a ‘developer’ of the site to help sell the land.
JDG Properties Limited bought land in Hertfordshire in 2011 and sold it in plots through Gilbert Webb Estates Ltd.
Tithebarn Trading Ltd posed as a development company and entered into a 5-year options agreement for 50p with some investors to buy back the plots of land at a price £52.43 per square ft.
JDG Properties Limited benefited by 100% on each plot of land that was mis-sold.
The overall value of the site was over £20m.
Chris Mayhew, Company Investigations Supervisor, said: “Whilst neither of Mr Elster’s companies was directly involved in the sale of plots of land to members of the public, they were symbiotic to the land banking scheme and fortified the mis-selling of plots of land by Gilbert Webb Estates Ltd enabling all involved in the scheme to profit apart from investors.”
“The scheme made no commercial sense and was once more calculated to part honest people from their money.
“The Insolvency Service will not allow companies to operate in this way and will investigate abuses and close down companies if they are found to be operating against the public interest.”
According to the Insolvency Service, the grounds to wind up JDG Properties Limited and Tithebarn Trading Ltd were their lack of commercial probity by making misleading and unfounded statements and their involvement in trading contrary to the public interest.
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