Imperial Consolidated set to lay off hundreds

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The Independent Online

Imperial Consolidated, the UK and offshore finance group, whose misfortunes have been extensively reported by the Independent on Sunday, is expected to lay off at least 100 of its staff at its Lincolnshire headquarters.

Imperial Consolidated, the UK and offshore finance group, whose misfortunes have been extensively reported by the Independent on Sunday, is expected to lay off at least 100 of its staff at its Lincolnshire headquarters.

The group says it is pulling out of direct involvement in one of its core activities, retail consumer lending. It says it will "outsource" its existing lending business to an outside firm, RM Management.

Imperial Consolidated's role in consumer lending has attracted considerable controversy. Mirfield Financial, a separate group subsidiary, has been involved in several expensive civil court cases brought by rival companies over its aggressive poaching of staff and clients. This week Imperial Consolidated was faced with a bill for £230,000 damages plus costs from the Manchester-based company Eccles Savings and Loans. Imperial Consolidated has already paid tens of thousands of pounds in damages and costs to two other companies and was fined £12,500 plus £8,516 in damages for contempt of court over Mirfield.

One sector major, Provident Financial Services, is also said to be demanding around £700,000 in damages, after its agents were persuaded to break their contracts to join Mirfield. Imperial Consolidated bought Mirfield, a specialist in smaller loans to low-income borrowers, in early 2000 and the company then adopted an aggressive and expansionist strategy.

Many in the industry are critical of the way Imperial Consolidated ran Mirfield. One industry insider said: "Their lending policy has been disastrous. It caused consumers a great deal of upset and difficulty."

The parent group has had a string of misfortunes. In July, the former chairman and chief executive officer were banned from acting as directors of British companies after a successful application by the Official Receiver. Lincoln Fraser, 29, and Jared Brook, 31, co-founders of Imperial Consolidated, were each disqualified for four years. The new senior managers of the company reviewed the company's portfolio and decided to move out of direct involvement in consumer lending in the UK and concentrate on commercial leasing contracts.

A spokeswoman said: "Unfortunately, this refocusing is likely to lead to a number of redundancies amongst those working in the retail businesses at Binbrook. This announcement will not affect Mirfield Financial Services, where no redundancies are expected to be made.

"We can confirm that the consumer lending business offered by Imperial Consolidated will continue to be provided by a number of independent companies. RM Management Services is one of these."

She added: "Despite the rumours, Imperial Consolidated is not going into liquidation but will concentrate on its commercial business interests moving forward."

Founded in 1994, Imperial Consolidated is a UK-based financial group with subsidiaries in 11 countries, mostly offshore. It started as a debt-collecting agency and in Britain it was employing 340 people. Its spokespeople say it has 28,000 British clients for its various investment schemes.

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