Hinchliffe faces new court threat

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Receivers to Facia, the collapsed retail empire run by controversial Sheffield businessman Stephen Hinchliffe, are preparing for moves against his web of private companies over debts of up to pounds 10m owed to the group.

Sources say accountant KPMG is considering court petitions to wind up Colibri lighters and toiletries maker French & Scott over pounds 2.5m of "unorthodox loans" advanced by Facia.

Also in the firing line are Autothrust and Allied Investments, whose assets are thought to include Parkhead Hall, Mr Hinchliffe's luxury Sheffield headquarters, and Chase Montagu.

Chase Montagu is the key company in the empire. It owns a collection of classic cars and paintings, as well as a 15 per cent stake in Sheffield United football club, according to the latest filed accounts. The firm also received up to pounds 1m in acquisition "finders fees" from Facia, which KPMG is eager to clarify.

Facia collapsed five weeks ago with debts of pounds 30m, but the three executive directors, Mr Hinchliffe, Christopher Harrison and Gary O'Brien, have yet to file sworn statements of affairs within a statutory 21-day deadline.

The Department of Trade and Industry is already seeking to disqualify Mr Hinchliffe and Mr Harrison as directors over the 1993 collapse of sports surface maker En Tout Cas.

The DTI would not confirm this weekend that it was looking into Facia, although it has already investigated two other failed Hinchliffe firms: Shoesave and Bukta Sportswear in 1994.

Mr Hinchliffe has denied responsibility for anything untoward in the failures, saying he sold the firms before they collapsed. While seeking up to pounds 40m of refinancing, he also tried to sell Facia to Texas American, a shell US company, just before the crash.

KPMG is still piecing together the extent of its claims against Mr Hinchliffe, but sources say cheques were signed by him without full board authorisation. "Essentially, the Facia companies were paying for everything: helicopters, golf clubs, holidays, wives, cars. Nothing Mr Hinchliffe has done suggested he ever knew the difference between himself and the companies," one source said.

Concern at Facia's runningprompted angry exchanges with fourth director David MacLellan, representative of institutional backer Murray Johnson.

"You state that you have no control over anything and that you are heading towards a criminal conviction. You state further that you are unconvinced regarding our ability to raise new funding," Mr Hinchliffe replied heatedly on 2 May, a month before the crash, to a letter from Mr MacLellan the previous day.

Murray Johnson has declined to comment, but Mr MacLellan's concerns are understood to have related to dealings with Mr Hinchliffe's private companies and possible insolvent trading, which is a criminal offence.

He also raised concerns about Facia's relationship with its main bankers, United Mizrahi Bank.

So far the receivers have realised up to pounds 15m from sale of Facia's Sock Shop, Contessa, Salisbury's, Oakland and Red or Dead chains, enough to pay off UMB in full. A creditors' meeting has been set for 13 August.

Price Waterhouse, administrator to the Freeman Hardy Willis and Saxone shoe chains, hopes to set a date shortly.