Broker pays for leaving New York

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The Independent Online

ICAP, the money broker whose New York offices were destroyed in the World Trade Centre disaster, is having to pay back the best part of $8m (£5m) in local government grants because it has decided to relocate to New Jersey.

The group's Garban Intercapital subsidiary occupied the 55th floor of the northern tower and the 25th and 26th floors of the southern.

The firm lost only one of its 674 members of staff in the disaster but claims that the disruption – it has squatted in at least three different locations in New York and New Jersey since 11 September – has cost it more than £15m.

Earlier this month Garban signed a lease on 111,451 square feet of space in Plaza 5, a new development in Jersey City, across the Hudson River from New York.

ICAP has flagged that it will receive some incentives, believed to exceed $7m, from the state of New Jersey to move to the site.

However, The Independent on Sunday has learned that these incentives will be eaten up by what ICAP will have to pay back to New York.

The ICAP group, including the broker Exco, which was bought in 1998, has been paid a total of $8m in grants – $6.2m from New York City and $1.8m from New York State.

These grants were to promote employment in New York. However, even before the move to New Jersey, local government officials were unhappy with ICAP's job creation in New York.

The company has agreed with the office of the New York mayor to pay back $6m of its grant in a 12-year deal, with the first $500,000 payment made last month.

In addition, the state governor, George Pataki, has demanded back $1.44m of New York State's $1.8m grant – sending a letter to ICAP on 4 September. The letter was lost in the disaster.

However, the state is pressing its claim and ICAP is now in talks to sort out a deal.