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DJM - Statement of Affairs released

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8 minutes ago, 5944 said:

He's still alive and posting on other forums, same as before it all went belly up. His signature still states model designer and manufacturer. Ahem....! 

 

Please do tell which other forums ;) 

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DJ won't get a bill from the liquidators because they act on behalf of the creditors and have first bite at monies recovered.  What Funding Circle can claim depends on their terms, but I think that sometime ago he posted on another DJ-related thread that he had two houses - quite possibly one was inherited.  This would have been part of his discussion on 'capacity' to take on more projects.

 

It might be worth mentioning that whilst I am retired now my background includes 35 years of working in investment on a professional basis.  My first employer had a mortgage subsidiary which got into trouble around the late 80s in commercial loans, and a colleague and myself were asked to look into this.  We did find some evidence of potential wrongdoing in certain loan applications and our report went as far as the CEO (we were an 8000 employee FTSE company) but he decided not to take any action due to potential publicity, although the mortgage manager found himself 'early-retired' and his deputy was demoted and moved to another job.  As already mentioned, lenders to DJ almost certainly have a bad loans provision in their costings which will absorb their losses. 

 

An angle not mentioned (I think) is that Chinese contracts are likely to be in US dollars and, depending on when they were signed, there could have been a lot of currency movement between then and now.  Keeping the same selling price in GBP would involve taking on the whole currency risk - especially if the crowd funder's price incorporated no profit margin.  The longer the project takes to deliver, the more the risk.

 

Finally, crowdfunding is regulated to an extent by the Financial Conduct Authority in the UK which defines four types in the relevant part of its website (in google, put in FCA crowdfunding).    I think DJ comes under the fourth category where only payment provision is regulated.  However, I would certainly recommend any business contemplated calling something 'crowdfunding' to check with the FCA to establish the regulatory position.

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2 hours ago, The Stationmaster said:

 What we do know is that he has put a creditor's claim for £50k against the company he was until recently managing as its sole director and which he put into creditors voluntary liquidation.

 

When I mentioned this to Mrs Spikey (she being among other things The Accounts Department when we used to be in business), she quite reasonably asked "How's that work then?  He wants back £50K he put into the business before putting it into liquidation, but at the same time he doesn't list people who paid deposits for goods they haven't received as creditors?  Is this kosher?"

 

I can't answer that 'cos I simply don't know, so can somebody kindly give me an explanation of how it works so that both of us here might be enlightened?

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6 minutes ago, spikey said:

can't answer that 'cos I simply don't know, so can somebody kindly give me an explanation of how it works so that both of us here might be enlightened?

 

Only one person could answer the "why?" question there, but he's not likely to. I can imagine the liquidators running through famous Donald Rumsfeld lines when they look at numbers.

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4 minutes ago, spikey said:

 

When I mentioned this to Mrs Spikey (she being among other things The Accounts Department when we used to be in business), she quite reasonably asked "How's that work then?  He wants back £50K he put into the business before putting it into liquidation, but at the same time he doesn't list people who paid deposits for goods they haven't received as creditors?  Is this kosher?"

 

I can't answer that 'cos I simply don't know, so can somebody kindly give me an explanation of how it works so that both of us here might be enlightened?

One answer might be that as far as he was concerned those people were 'investors' and therefore they were not customers who had paid a deposit/stage payment or whatever you cared to call it.  And as 'investors' he made quite clear that their money was at risk - which as it turned out was absolutely true of course.  

 

There is however the interesting matter of semantics with the APT where the initial payment was called a deposit (which implies it was part payment on a product whatever DJM might have said about it)) plus there is in any event the question of consumer rights as was examined in the thread about crowd funding.  

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Thank you gentlemen.  So as Mrs Spikey says, in essence, the fundamental problem is the apparent disparities between what Mr Jones seems to have viewed the crowfunders' payments as, what they viewed them as, what the man on the Clapham omnibus might view them as, and what m'learned friends would say they were?

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13 minutes ago, spikey said:

Thank you gentlemen.  So as Mrs Spikey says, in essence, the fundamental problem is the apparent disparities between what Mr Jones seems to have viewed the crowfunders' payments as, what they viewed them as, what the man on the Clapham omnibus might view them as, and what m'learned friends would say they were?

 

Whatever the specific legal terminology might be, I suspect the man on the Clapham omnibus is of the opinion that a rum cove has had it away with the money.

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4 hours ago, Fenman said:

 

Well, no, but a bit of human compassion might not go amiss. I doubt he’s sunning himself on a Caribbean island while nubile virgins pop grapes into his open mouth. Instead, I suspect he’s having a pretty miserable time (and no, I haven’t forgotten the financial “victims”, of whom I am one). 

 

Paul

I would probably be more likely to extend benefit of doubt if he hadn't made a habit of making accusations against Chinese factories which appealed to those with a liking for cheap stereotyping, blaming all and sundry every time he failed to file accounts, have a functional website etc, accused others of illegal anti-competitive acts, tried to pee on other manufacturers fires by pre-empting announcements etc. 

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Posted (edited)
1 hour ago, spikey said:

Thank you gentlemen.  So as Mrs Spikey says, in essence, the fundamental problem is the apparent disparities between what Mr Jones seems to have viewed the crowfunders' payments as, what they viewed them as, what the man on the Clapham omnibus might view them as, and what m'learned friends would say they were?

 

Mr Jones can believe what he likes (and it seems he does), but the way some of the banks are issuing s75 refunds suggest your man on the omnibus should be viewing the payments as deposits/part payment

Edited by Ouroborus
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30 minutes ago, Ouroborus said:

 

Mr Jones can believe what he likes (and it seems he does), but the way some of the banks are issuing s75 refunds suggest your man on the omnibus should be viewing the payments as deposits/part payment

 

Ahh!  The ever present Trump card!!

 

Julian

 

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Card companies issuing S75 refunds isn't an admission Dave is in the wrong, it's just easier than investigating or appraising each one. The amounts are tiny.

 

There are a number of reasons Dave didn't include the crowdfunding deposits on the SoA, most obviously:

- he's inept

- he counted them as investments for which he wasn't obliged to provide any product

 

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If he counted Crowdfunders deposits as investments for which he wasn't obliged to provide any product then that surely means his various publicity/advertisements for the likes of the King, APT, etc, etc, adnauseum could potentially be viewed as false advertising.

 

Meanwhile, I have today run the two Dutch Engineers liveried Mermaid's I have just purchased from Hattons.  There seems to have been a noticeable drop  in quality control over the first batch that was produced as my black livery one ran perfectly, the two Dutch ones derailed left, right and centre and ran like a right dogs dinner...

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Yes, I'm not passing judgement on whether he acted improperly in doing so, simply that's possibly how he viewed the payments.

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3 hours ago, Covkid said:

 

Also interested to know  - please 

I couldn't possibly comment on the fact he frequents a forum that reviews UK air shows... 

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Posted (edited)
8 hours ago, John M Upton said:

If he counted Crowdfunders deposits as investments for which he wasn't obliged to provide any product then that surely means his various publicity/advertisements for the likes of the King, APT, etc, etc, adnauseum could potentially be viewed as false advertising.

More like false hope than false advertising. He was trying expecting to deliver beyond his abilities/resources. 

Edited by truffy
not trying hard enough!

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Makes you wonder if all the crowdfunded projects were refundable deposits would any of them have actually proceeded even to the CAD stage,  let alone "imminent tooling".    Due diligence and duty of care are uppermost in my thoughts.  

 

If the deposits were non-refundable "investments" in his projects then perhaps this may partially explain his eagerness to progress projects beyond the expression of interest phase, apparently with insufficient numbers needed for production.  Hopefully,  in the fullness of time,  all will be made clear but I would not be waiting on a definitive finding from the liquidators as they seem more interested in just settling known creditor accounts and not an in depth  investigation into the funding method used.

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9 hours ago, Persephone said:

Ahh you mean this one and HeyfordDave111? 

 

http://forums.airshows.co.uk/

 

Crowdfunded 1:24 F111 model anyone https://www.rmweb.co.uk/community/uploads/emoticons/default_biggrin.png

 

8 hours ago, Ravenser said:

 

Don't F111s have a reputation for falling out of the sky and crashing???

 

I can see now where Dave's passion lies.

We used to sit on the bank of the above the Bicester line and watch the F111s and EF111s come and go from Upper Heyford.  Amazing things they were, and with a completely enclosed ejector capsule, so when you "punched out" you both went in your "bubble", not that you's do that too often !!!  

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.

 

Again, I will note that the crowdfunding was, supposedly, for the CAD development.  CAD was developed.

 

Theoretically that CAD has a value/residual value, but the statement of affairs states that that is assessed as zero, so (at least in theory) the money has been spent on what it was meant to be, but that is now worthless.

 

----------------------------

 

That is a simple look at things.   It could be that there are more complicated, less simple aspects;

 

-  was the money raised sufficient to allow the CAD development to go ahead with a reasonable chance of success ?  

 

-  was the money spent (whether directly or indirectly) only on CAD development, or was it used on other things ?

 

-  was the reason that the CAD became unavailable to use by DJM (and hence zero value) down to DJM poor decisions, or something outside his control ?

 

-   etc ...

 

HOWEVER, that does not take away from the fact that, at least at a superficial look, the crowdfunding was used as envisaged.

 

.

 

 

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17 minutes ago, Mike Bellamy said:

 

Someone in the City must know something - now Funding Circle is in trouble . . . . . . . ! !

 

https://www.bbc.co.uk/news/business-48837598

 

.

Strangely, the BBC report doesn't mention the role of DJM in FC's woes. Sloppy 'journalism', yet again! :rolleyes:

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23 minutes ago, Mike Bellamy said:

 

Someone in the City must know something - now Funding Circle is in trouble . . . . . . . ! !

 

https://www.bbc.co.uk/news/business-48837598

 

.

 

"But in April, the company's shares took a hit after it announced plans to wind down a fund that financed a number of small business loans." (from the BBC article)

Coincidence? It might have set in motion a train of events, or it may not.

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36 minutes ago, phil gollin said:

 

-  was the money spent (whether directly or indirectly) only on CAD development, or was it used on other things ?

 

 

I suspect that the money raised by DJM (be it deposits, crowdfunding payments, loans, etc) has been spent on more than just CAD, and includes directors salary/withdrawals, travel costs (trips to China), advertising (in magazines and forums), website development, loan interest repayments and generally running the company. And I guess it's all gone - hence liquidation of the company and any assets it might have (not that they are worth anything).

 

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