Lord McAlpine, former treasurer of the Tory party, said last week that the company, Emergency Networks Inc, of Dallas, was the means by which Mr Thatcher made his fortune - comments designed to deflect allegations that he made pounds 12m from a British-Saudi arms deal.
But Bruce Leadbetter, the company's former president, said yesterday: 'We all lost a lot of money in the company, including Mark. No one got rich out of it.' The disclosure gives rise to questions about how Mr Thatcher made his fortune.
Emergency Networks, which sold security systems and alarms, is now undergoing Chapter 7 bankruptcy proceedings in Dallas, the equivalent of liquidation in the United Kingdom, having failed to survive an attempt to restructure itself.
It ran into trouble in 1992 when its primary customer, Alert Security, went bust owing it up to dollars 18m. Papers filed at the US Bankruptcy Court in Dallas show the company with liabilities of dollars 50.64m and only dollars 17.66m assets.
Mr Leadbetter said Mr Thatcher was a shareholder and director of Emergency Networks Inc. at the time it ran into trouble, but he resigned before it voluntarily went into bankruptcy. His business associate, David Wallace, who ran Baroness Thatcher's Thatcher Foundation until recently, was also a director with 2.66 per cent of the stock.
'Mark resigned because he could see what the problems were,' Mr Leadbetter said. 'He could see the writing on the wall and he didn't have time to sort out the problems. 'It was a good company but we all lost money on it. Even when it was going well, no one was awash with money because we were investing and reinvesting.'
It employed 1,600 people at 35 branches in 11 states at the time of its collapse. Mr Leadbetter refused to say what percentage of the company was owned by Mr Thatcher or how much he lost.
Among the losing investors was the EDS Capital Corporation, formerly owned by Ross Perot, the former presidential candidate and close friend of Lady Thatcher, which sank dollars 8m into the business. Mr Leadbetter said that money was likely to be lost.
The company's largest creditor is the Internal Revenue Service which is owed almost dollars 3.4m in taxes that were deducted from employees pay but not passed on to the taxman. Mr Leadbetter, who insisted that the company's final debts would be well below dollars 30m, said he believed the IRS would be paid from the disposal of remaining assets.
It was also reported yesterday that two of Mr Thatcher's other business interests, the Grantham Company and Ameristar, both based in Houston, were being investigated by US Customs over allegations of arms deals with Iraq.
No US Customs officials were available for comment.Reuse content