Police briefed on Facia collapse

Receivers to Facia were this weekend in contact with the police over the collapse of the retail empire owned by controversial Sheffield businessman Stephen Hinchliffe.

The move came as accountants KPMG prepare to sell Sock Shop early this week. KPMG also hope to sell at least one of four other chains - Contessa lingerie, Red or Dead fashion, Torq jewellery and Oakland menswear - as it starts to piece together Facia's tangled debt and accounting affairs.

KPMG partner Tony Thompson said meetings would be held with Facia auditors Deloitte & Touche. They would investigate whether there is any evidence of breaches of insolvent trading laws, which would be a criminal offence.

The group collapsed last weekend with total debts of pounds 30m, including pounds 7m to Israel's United Mizrahi Bank, which put the receivers in after court action by retail giant Sears.

KPMG found that Facia had no cash and no bank or credit lines on which to draw. "There were no facilities at all available to the group that were unutilised at the time," Mr Thompson said.

Just before the collapse Deloitte & Touche had sufficient concerns over the running and funding of the group to have considered contacting the police and the Department of Trade and Industry themselves. Mr Hinchliffe and Facia finance director Christopher Harrison already face disqualification as directors over the collapse of another company in 1993.

Deloitte & Touche have been unable to finalise Facia's late 1995 accounts because of the concerns. The auditors expressed similar reservations in heavily qualifying Sock Shop's 1995 accounts earlier this year, as did KPMG with Salisburys.

Talks will continue tomorrow with a whittled-down list, with Sock Shop and the other chains expected to achieve a quick sale. More than 8,000 jobs are at risk at the 850-store group, including the Freeman Hardy Willis, Saxone and Curtess shoe chains which Mr Hinchliffe owns personally.

Last week, accountant Grant Thornton kicked off the disposals with the sale of 39 Salisburys luggage shops. Price Waterhouse, put in as administrators to the shoe shops by Sears, said, however, it would take at least a month to call a creditors meeting to decide their future.

Sears is owed pounds 29m, including pounds 21m for stock, and its court action sparked the receivership after Facia failed to pay rent and a cheque for wages bounced.

The fiasco, which has cost Sears nearly pounds 80m, has prompted calls for the head of its chief executive, Liam Strong, although his chairman, Sir Bob Reid, rallied to his support last week.

First Financial, Facia's former PR advisers, said that Mr Hinchliffe had insisted early last week that he had "three facility letters on which he could draw" but which they had not seen.

Confusion also reigned over whether Mr Hinchliffe was involved in an attempt by Facia chief executive Gary O'Brien to buy the shops back.

Such a sale would anger creditors but appears unlikely: "He's got a problem with his financing," one source close to the talks said.

Voices
A Russian hunter at the Medved bear-hunting lodge in Siberia
Save the tigerWildlife charities turn to those who kill animals to help save them
News
Davis says: 'My career has been about filling a niche - there were fewer short actors and fewer roles – but now I'm being offered all kinds of things'
PeopleWarwick Davis on Ricky Gervais, Harry Potter and his perfect role
News
i100
Sport
Frank Lampard will pass Billy Wright and equal Bobby Charton’s caps tally of 106 caps against
sportFormer Chelsea midfielder in Etihad stopgap before New York contract
PROMOTED VIDEO
Arts and Entertainment
The first film introduced Daniel Radcliffe to our screens, pictured here as he prepares to board the train to Hogwarts for the first time.
booksHow reading Harry Potter helps children grow up to be gay-friendly
Arts and Entertainment
A scene from Aladdin is performed at the Tony Awards in New York in June
theatreBrit producer Lythgoe makes kids' musical comedy a Los Angeles hit
Sport
Usain Bolt of Jamaica smiles and shakes hands with a competitor after Jamaica won their first heat in the men's 4x100m relay
sport
News
Chancellor George Osborne, along with the Prime Minister, have been 'complacently claiming the economy is now fixed', according to shadow Chancellor Ed Balls
i100... which is awkward, because he is their boss, after all
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Financial Analyst - Forecasting - Yorkshire

£300 - £350 per day: Orgtel: Financial Analyst, Forecasting, Halifax, Banking,...

Business Architect - Bristol - £500 per day

£500 per day: Orgtel: Business Architect - Banking - Bristol - £500 per day A...

Regulatory Reporting-MI-Bank-Cardiff-£300/day

£200 - £500 per day + competitive: Orgtel: I am currently working on a large p...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Day In a Page

Save the Tiger: Meet the hunters tasked with protecting Russia's rare Amur tiger

Hunters protect Russia's rare Amur tiger

In an unusual move, wildlife charities have enlisted those who kill animals to help save them. Oliver Poole travels to Siberia to investigate
Transfers: How has your club fared in summer sales?

How has your club fared in summer sales?

Who have bagged the bargain buys and who have landed the giant turkeys
Warwick Davis: The British actor on Ricky Gervais, how the Harry Potter set became his office, and why he'd like to play a spy

'I'm a realist; I know how hard this business is'

Warwick Davis on Ricky Gervais, Harry Potter and his perfect role
The best swim shorts for men: Bag yourself the perfect pair and make a splash this summer

The best swim shorts for men

Bag yourself the perfect pair and make a splash this summer
Has Ukip’s Glastonbury branch really been possessed by the devil?

Has Ukip’s Glastonbury branch really been possessed by the devil?

Meet the couple blamed for bringing Lucifer into local politics
Dress the Gaza situation up all you like, but the truth hurts

Robert Fisk on Gaza conflict

Dress the situation up all you like, but the truth hurts
Save the tiger: Tiger, tiger burning less brightly as numbers plummet

Tiger, tiger burning less brightly

When William Blake wrote his famous poem there were probably more than 100,000 tigers in the wild. These days they probably number around 3,200
5 News's Andy Bell retraces his grandfather's steps on the First World War battlefields

In grandfather's footsteps

5 News's political editor Andy Bell only knows his grandfather from the compelling diary he kept during WWI. But when he returned to the killing fields where Edwin Vaughan suffered so much, his ancestor came to life
Lifestyle guru Martha Stewart reveals she has flying robot ... to take photos of her farm

Martha Stewart has flying robot

The lifestyle guru used the drone to get a bird's eye view her 153-acre farm in Bedford, New York
Former Labour minister Meg Hillier has demanded 'pootling lanes' for women cyclists

Do women cyclists need 'pootling lanes'?

Simon Usborne (who's more of a hurtler) explains why winning the space race is key to happy riding
A tale of two presidents: George W Bush downs his paintbrush to pen father’s life story

A tale of two presidents

George W Bush downs his paintbrush to pen father’s life story
Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover

The dining car makes a comeback

Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover
Gallery rage: How are institutions tackling the discomfort of overcrowding this summer?

Gallery rage

How are institutions tackling the discomfort of overcrowding this summer?
Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players

Eye on the prize

Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players
Women's rugby: Tamara Taylor adds fuel to the ire in quest to land World Cup

Women's rugby

Tamara Taylor adds fuel to the ire in quest to land World Cup