A Conservative party donor’s advice firm has suffered a £3.8 million loss after it wrote off an investment in a biofuel scheme run by tax scheme provider Future Capital Partners.
James Kaberry (pictured) donated £10,000 to Conservative MP for Northampton North Michael Ellis in September 2014. Kaberry is also a director of London-based financial advice firm Pantheon Financial.
Financial statements filed at Companies House show Pantheon wrote down a £3.6 million investment in Elysian Fuels 2011 No. 1 in 2014..
As a result, Pantheon posted a pre-tax loss of £3.8 million in the period between 1 January 2014 and 30 December 2014, compared to a pre-tax profit of £33,705 the previous year.
Without the write down the firm would have posted a pre-tax loss of £199,000.
Elysian Fuels was a biofuel scheme set up by Future Capital Partners. Future also ran the Eclipse 35 film scheme which lost a court appeal against HM Revenue & Customs in February 2015. Kaberry was also a member of the Eclipse scheme.
Elysian invested in biofuel production plants. In this case Elysian Fuels 2011 No. 1 was created to raise capital to invest in a limited liability partnership (LLP) called Elysian Fuels 4 LLP.
Pantheon was not a member of Elysian Fuels 4 LLP but Kaberry was.
This LLP then provided the services for Vireol Limited which in turn provided services to refurbished biofuel plants in Grimsby and the USA. The LLP received fees for the business, and investors also expected to receive a fee when the company was sold.
However a fall in oil price meant the scheme was not as successful as hoped.
In November 2015 it was reported that shares in Elysian were valued at nothing. A number of sports stars were allegedly caught up in the scheme, including former Liverpool and Real Madrid manager Rafa Benitez and snooker player Stephen Hendry.
Kaberry originally held the investment in Elysian fuels No. 1. In November 2011 Pantheon acquired the stake for £3.7 million.
Kaberry loaned Pantheon the money it needed to buy the stake on the basis that it would be paid back over three years with an interest rate of 12% per year.
However, the financial statements for the year ending 30 December 2014 showed Kaberry changed the terms of the repayments in July 2014 so that Pantheon would pay £20,000 a month in capital and interest until June 2023.
Pantheon originally said it invested in the high risk scheme because it believed it offered higher returns than running an advice business.
In financial statements for the year ending 31 December 2012 the company said: ‘The directors invested in this project [Elysian] because they felt that this market offered attractive growth potential and the potential for returns far greater than those offered by the core business.’
Pantheon Financial and Kaberry declined to comment. Ellis did not respond to a request for a comment.