January 2024 Update from the Wellesley Investors Action Group

This article reflects the opinions of its author and not necessarily those of ShareSoc.

Cliff Weight originally highlighted the Wellesley Investors Action Group, in this article.

I still encourage those affected to join Neil Taylor’s group, but I’ve had some requests for an update from affected investors. Neil has kindly provided the following update:

To put you in the picture, Wellesley Finance Ltd, the company that went into a Company Voluntary Arrangement (CVA) on 25 September 2020, has failed to pay back investors’ payments. It is complicated, so I will try to give you some insight.

As you may know, Wellesley Group collapsed into a CVA on 25 September 2020, which was approved on the 13 October 2020. This affected three trading companies within the “Wellesley Group”, namely Wellesley & Co Ltd (WACL), the originally FCA regulated p2p entity, Wellesley Finance PLC (mini bond/PMB company, and an associate company called Wellesley Secured Finance PLC (WSFP) who operated listed property bonds from April 2019, after the FCA, strangely gave full permission to WACL in Feb 2019, when it was clear the Wellesley Group was insolvent at the time.

Investors were offered a range of complex settlements via the CVA. The investors at the time amounted to £134.7m and the return to investors so far is £67.3m, so 50% return. This return varies depending on what products you invested in, the range of 1p/£ to 83p/£.

3,489 Investors in Wellesley Group products, namely Wellesley mini-bond (Series s1/s2/s3), were offered 1p/£ cash, or alternatively a “preferred” shares route in Wellesley Finance PLC. This company is now called Wellesley Finance Ltd (WFL). The preferred shares pledged to pay back investors only 25p/£ of their investment, but this was at least better than the 1p/£ cash settlement.

The CVA gave the above option to Property Mini Bond holders too (PMB), who were offered more by way of cash settlement. If they did not elect for the cash option, the preferred share route was the default option, many may have been caught out here by the speed of the CVA being signed off, only 3 weeks between issue and approval. We estimate that up to 4,250 investors have preferred shares holdings.

The preferred shares issue amounts to 10,089,328 shares of £1 each, so £10,089,328 in nominal value. The preferred shares did not have any visible preferred status, but the CVA PAYMENT PLAN pledged to repay (redeem them-buy-back) these shares in two instalments, one in December 2023 and the second instalment in December 2024.

The preferred shares could only be paid back on WFL hitting a profit threshold. This, in essence, was that repayment will only be made out of excess distributable profit over £5m. This appears not to have been made. In fact, we see that losses in WFL are reported in last published accounts to 31 December 2022. These losses are £1.46m.

It appears Wellesley Finance Ltd have not re-started the business with institutional investors as stated in the CVA. Minimal new business has been concluded so far over 2 years on.

Wellesley Investors Action Group (WIAG) have written to Wellesley on the 17 December 2023, as they have made no contact with investors. I have received a limited reply acknowledging our letter on the 29 December 2023. They intend to give a “general update” to investors in January 2024. We still have not heard anything, a scandalous and deplorable state of affairs. We have asked once again for the business plan and details of 2023 trading.

Wellesley and Kroll claim the share repayments are outside the CVA. This, of course, is nonsense: this was an integral feature of the CVA; alongside the sale of the loan book at the time to themselves for £30m less than its value at the time of the CVA. This is how they have continued, with taking investors funds, and not securing tangible and institutional investors so far.

Here is a copy of our letter sent to Wellesley on the 17 December 2023, this emailed and special delivery to their Registered Offices as we have no idea where they are trading.

We also have a very detailed and comprehensive complaint about Wellesley with the FCA which is being deferred every 6 months by the FCA. This is as a result of their enforcement actions and investigations being taken against Wellesley at present. Details of this investigation are totally unknown to us.

Neil Taylor, Wellesley Investors Action Group

Mark Bentley, Director, ShareSoc

Post Date: February 13, 2024

Group description:	All levels of experience welcome. A typical meeting agenda includes: – Macro Environment – Trades: Members review existing positions and identify securities with promising TA entry patterns or setups and with suitable risk/reward. Any security, long, short, futures, options may be considered. The convener takes actual positions in trades and maintains his own detailed ledger, accurately measuring performance of individual securities and cumulative activity. Members are notified by e-mail prior to the entries or exits that are decided upon. Following each meeting an updated copy of the ledger is circulated together with the next meeting agenda. Members may wish to maintain similar ledgers of their own but there is no obligation to do so. – Technical Analysis: Techniques and systems used in trades. Members can request discussion of particular aspects of TA.
Meeting Type/Venue:	Online via Zoom
Meeting Frequency/Timing:	The first Tuesday of every month from 7 to 9pm

Group description:	Following the launch of the SIGnet Technical Traders groups, it was identified that there were a number of members who use fundamental and other information as their main source of choosing companies to invest in, who would find some understanding of technical analysis helpful to identify good entry and exit points for their investments. This new SIGnet Technical Analysis in Support of Investing group is therefore being launched and we welcome members of all levels of experience to join.
Meeting Type/Venue:	Online via Zoom
Meeting Frequency/Timing:	There will be an initial Zoom meeting on Monday 29th April at 7pm to launch this group, please email info@sharesoc.org if you are interested in joining.

Group description:	A new in person group coming soon! Keep and eye on our Events page to register for the launch meeting.
Meeting Type/Venue:	In person
Meeting Frequency/Timing:	TBC

Group description:	Open to all investors / people with an interest in investing. Typical meeting will involve members talking about recent purchases, successes, failures and possible future purchases. Also with occasional visiting speakers or members making presentations on a topic of interest.
Meeting Type/Venue:	We aim to meet on the last Tuesday of each month in a private room at a pub in Playhatch. Start time 7pm with members encouraged to meet up around 6pm for a bite to eat / drink before hand, if their diaries allow.
Meeting Frequency/Timing:	7pm on the last Tuesday of the month. Meetings likely to last about two hours but with informal ‘overspill’ before / after.

Group description:	This group was set up as a forum to discuss companies in detail, each company is introduced by a member and discussion may last one or two hours. Membership is by invitation only and is for experienced investors.
Meeting Type/Venue:	The group meets at a venue in Waterloo, London.
Meeting Frequency/Timing:	Meetings are on Tuesday mornings at two month intervals.

Group description:	Our group members have wide ranging investment experience and work backgrounds. Discussion topics include reviewing our recent stock or collective investment buying and selling activity, plus what we are considering buying or selling and the reasons for our decisions. We also have a wider discussion on where we think opportunities might arise in the next few months and what we think needs to be avoided. Members occasionally lead discussions on specific topics such as recent events attended, articles or books of interest and sources of investment ideas and information.
Meeting Type/Venue:	During the pandemic our meetings were held on Zoom, but we have now resumed meeting in person at a location a few miles to the west of Colchester. Most meetings will now be in person, but it is possible that occasional meetings will be held on Zoom in special circumstances.
Meeting Frequency/Timing:	We meet midweek every two months. Zoom meetings run for about two hours from 10.30am and in person meetings from 11am until about 3pm, including a break for lunch.

Group description:	Our group is a broad church that contains investors of varying age and experience. We discuss stocks and investment trusts that we have bought, sold or are interested in and the reasons behind our decisions, and try to make sense of the ever changing investment environment. Our members backgrounds are diverse and include corporate banking, engineering, teaching and the leisure industry. Discussions are robust and challenging but tend to be to be informal, and do not generally involve agendas, presentations or detailed preparation. We are a friendly and approachable group who welcome investors of all levels – we just ask that you contribute, at whatever level you can.
Meeting Type/Venue:	Our meetings are held in a very nice pub near to South Ealing tube station (Piccadilly Line), not far from Ealing Broadway (District, Central and Elizabeth Line). Group numbers permitting (and assuming members are happy to purchase food and drink from the bar), we may also have access to a private room in the pub.
Meeting Frequency/Timing:	We meet every 2 months, usually on a Wednesday morning at 11am.

Group description:	An online group for those who are new to investing. Including topics such as how to buy and sell shares, unit trusts, investment trusts, exchange traded funds and diversification, tax and how to save it, pensions, portfolio management and research tools, other asset classes and basic technical analysis.
Meeting Type/Venue:	Online using Zoom.
Meeting Frequency/Timing:	Meetings are usually held on the 1st Monday of the month at 7:15pm.

Group description:	Group focused on active investing, primarily in small / medium cap UK equities.
Meeting Type/Venue:	Regular Zoom meetings interspersed with occasional face to face meetings and social activities in the North West.
Meeting Frequency/Timing:	Monthly on Saturdays at 10am.

January 2024 Update from the Wellesley Investors Action Group

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