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Contractor banned after failed stadium redevelopment

5 February 2019 | By Neil Gerrard

A contractor and developer who received millions of pounds worth of council funding to redevelop a football stadium has been banned from running companies for 10 years.

1ST Land Limited was incorporated in August 2013 to act as the contractor for Northampton Town Football Club who wished to redevelop the Sixfields Stadium.

Howard Lawrence Grossman, 57, from Bushey, Hertfordshire, was sole director of the company which received at least £6m from Northampton Town FC to go towards the costs of redeveloping the stadium.

The football club in turn received the funds from the local authority – Northampton Borough Council.

But by January 2015, 1ST Land had entered administration.

Northamptonshire Police and the Insolvency Service investigated the company’s collapse and found that Grossman failed to ensure the company maintained adequate accounting records or deliver a sufficient amount of records to the administrators. As a result, it has been not possible to determine the exact nature of more than £5.6m worth of payments made to various parties from 1ST Land’s accounts.

One such payment concerns approximately £2.65m of transfers made to two separate third parties, whether they were made as loans, and under what terms.

Questions over payments

Another payment investigators were unable to establish was whether approximately £1.5m was paid to the benefit of Howard Grossman, his family and other connected parties and whether such payments were treated as dividends.

Sue MacLeod, Chief Investigator for the Insolvency Service, said: “Howard Grossman, like all directors, had specific duties as a company director but he blatantly disregarded them. The company’s insufficiencies when it came to record keeping means that we are unable to determine the exact nature of payments worth millions of pounds of tax-payers money, who along with supporters of the football club are the real victims here.

“We have been able to secure a substantial ban for Howard Grossman and if he breaches his disqualification, he risks being sent to prison.

“Northamptonshire Police is continuing their nationwide investigation into the missing Northampton Borough Council loan money and is working with other prosecuting authorities to recover public funds.”

Comments

Can this punishment of just banning from running companies for 10 years to the contractor/developer be fair to the taxpayers whose millions of pounds worth of council funding was given to him to redevelop a football stadium?
Absence of Financial penalties and not being sentenced to prison terms may give prospective contractors/developers/others THE PERCEPTION THAT IT MAY BE PROFITABLE IF FUNDS ARE PUBLIC. .

Gursharan Singh, 5 February 2019

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