Michelle Mone hit by court order on £75mn of assets in NCA fraud probe

 

Michelle Mone hit by court order on £75mn of assets in NCA fraud probe

https://www.ft.com/content/e7ef0631-cf37-4051-b7ff-7b6e7bcce55a

25 January 2024

 

Assets including Belgravia townhouse linked to Conservative peer and her husband have been frozen or restrained by court order

 

About £75mn of assets linked to Conservative peer Michelle Mone and her husband have been frozen or restrained by court order as the pair face a National Crime Agency investigation into alleged PPE fraud.

 

The court order seen by the Financial Times covers assets including a six-bedroom Belgravia townhouse, a country estate on the Isle of Man, and 15 accounts at Coutts, C Hoare & Co and Goldman Sachs International. 

 

The December restraint order blocks Mone and her Isle of Man-based financier husband, Douglas Barrowman, from selling some of the assets and places restrictions on others.

 

The order was consented to by Mone and Barrowman and followed an application by the Crown Prosecution Service under the Proceeds of Crime Act. The CPS acts in court on cases investigated by other agencies.

 

Mone, a lingerie entrepreneur whom Lord David Cameron made a Conservative peer in 2015, has been at the centre of a scandal relating to the sale of allegedly faulty personal protective equipment during the Covid-19 pandemic.

 

The NCA in May 2021 opened an investigation into “suspected criminal offences” committed in the procurement of PPE contracts by PPE Medpro, owned by a consortium led by Barrowman.

 

Mone last December told The Sunday Times she was being “treated like Pablo Escobar”, the late Colombian cocaine kingpin, after having her bank accounts frozen.

 

PPE Medpro was awarded government contracts worth more than £200mn within weeks of its incorporation in May 2020.

 

The contracts came after PPE Medpro was placed in the VIP “high-priority lane”, under which government officials and politicians recommended groups to supply goods during the early stages of the pandemic, following a recommendation from Mone.

 

The NCA is investigating Mone and Barrowman in relation to “allegations of conspiracy to defraud, fraud by false representation, and bribery, which they both categorically deny”, according to a recent documentary funded by PPE Medpro.

 

The UK government sued PPE Medpro in December 2022, claiming the company had breached its contract because the quality of £122mn worth of protective gowns the company sold was inadequate. PPE Medpro has denied that the goods were faulty and is contesting the lawsuit.

 

In a BBC interview in December, Mone admitted she stood to benefit from profits of about £60mn from the sale of protective equipment during the pandemic. She also admitted that she had previously lied to journalists about her involvement with PPE Medpro.

 

The court order was “a result of a consensual process during which negotiations took place with the CPS”, a spokesman for Mone and Barrowman told the FT.

 

“It allows the wider businesses and assets of the Barrowman family to operate normally and free from any restrictions or uncertainties,” he added.

 

“Doug and Michelle did not contest the application and were happy to offer up these assets, which means they can begin the task of proving their innocence more quickly,” the spokesman said.

 

Restraint orders are typically sought during a criminal investigation and ringfence assets for potential confiscation in the event of a conviction. Breaching such orders can result in imprisonment, a fine or asset seizures.

 

Among the assets restrained is 4 Chester Square in Belgravia, which was acquired by Isle of Man company Chester Ventures in December 2020 for nearly £9.25mn.

 

The property was purchased as an investment with plans to redevelop and resell the house, rather than as a personal asset, according to Knox Group, which is chaired by Barrowman.

 

The 6,000 sq ft residence, which features a sauna and steam room, and a purple-carpeted cinema room, has been on the market for £25mn, the FT revealed earlier this month.

 

The restrained assets include nine properties in Park Circus, an affluent area of Glasgow, owned through companies in the Isle of Man.

 

The order also covers the couple’s Ballakew Estate on the Isle of Man, which the NCA raided in 2022.

 

Two Coutts bank accounts, three C Hoare & Co bank accounts and 10 private wealth management accounts with Goldman Sachs International are also covered by the order.

 

The restraint order allows the couple to sell or rent out parts of their property portfolio.

 

It allows the sale of 4 Chester Square provided that the CPS is notified in advance before any contracts are exchanged and that the proceeds are held in a UK bank account agreed by the agency.

 

Under the order, the Glasgow properties cannot be sold but rental income from them is not restrained.

 

The assets covered by the order could be changed if their value rises above £85mn or falls below £65mn. In the event of a change, the total value of the assets restrained must be no less than £75mn, the order states.

 

The CPS obtained an interim order in May that included several entities in the British Virgin Islands and Isle of Man-registered LM Yachts Limited.

 

The interim order has been replaced by the December order, which does not include those entities.

 

According to the Equasis shipping database, LM Yachts Limited owns a 39 metre sailing yacht called Lady M, on which Mone and Barrowman controversially vacationed during the third wave of Covid in the summer of 2021. The yacht is listed for sale for €7.95mn.