The chief executive of Keydata, the collapsed specialist investment firm, made personal loans worth several million dollars to the man behind the investment vehicles that Keydata is blaming for a £103m shortfall in client funds.Court documents show that Stewart Ford lent $3.25m to David Elias, who managed funds that Keydata sold on to its clients. The loan, made in October last year, was supplemented by a further $1m in December, as well as a bond expressed to be worth $2.1m, according to the May summary judgment of a High Court case brought by Mr Ford against Mr Elias.
Both the loans and the court fight occurred during the period when SLS Capital, a Luxembourg company controlled by Mr Elias, failed to make regular interest payments to Keydata investors. SLS Capital has not made payments to investors since October and the underlying assets are missing, according to PwC, which was appointed Keydata??s administrator in June. The Serious Fraud Office is investigating the case.
The court documents quote Mr Ford as telling a business associate in January that ??he had been the victim of huge financial losses as a result of what he described as Mr Elias??s ??misdealings???.
But Keydata did not raise the alarm to investors when SLS stopped coupon payments. According to PwC, Keydata used several million pounds from its corporate accounts to make the payments and pay redemptions from the SLS products after SLS failed to respond to demands for payments.
Keydata??s directors have said they only learnt in June that the assets underlying the SLS fund ??appear to have been liquidated?.
The loans and the court fight are part of a battle between Mr Elias and Mr Ford for control of Polymer Vision, a Netherlands-based company that was majority owned by Mr Elias. Mr Elias, who reportedly died of complications linked to pneumonia in May, had been a fugitive of British justice since 2001.
Mr Ford tried to gain control of Polymer Vision once he suspected Mr Elias of defrauding him, citing a debenture arrangement that was part of the loan agreement. Polymer Vision, which develops computer screens, was put into administration last week. The administrator is contesting Mr Ford??s claims to own the company.
