Title 1

Msftedit 5.41.21.2510; Introduction

Committee for the Improvement of Sandwich Bay

Sadly, 1 am writing this account on Thursday, 11 September 2003, which means that my recollections are not so fresh as they were immediately after the meeting. However, the main facts remain clear in my head.

We decided to open the meeting with a statement of the facts as they could be represented by hostile outsiders, rather than seek to have these facts admitted by questioning. This second strategy might have had more impact, but might easily have been diverted by irrelevant detail from ??? and a continual evasion of the questions. So *** opened with the following statement: Councillor****l, you are involved in a large property transaction with a company that claims an association with a Swiss bank - we know this to be untrue; that claims the support of Whitbread - we know this to be false; that has no office in this country that we have been able to find; that is registered in a well-known tax haven that was until recently on the OECD black list for money laundering; the directors of which are unknown to the public. It is reasonable to assume that this lack of actual association with the Swiss bank and with Whitbread has had something to do with the considerable delays in submitting a planning application, as this would require the spending of £15,000 that SFP does not presently have. Looked at from the outside, all this suggests a scandal. Wild claims are circulating in Thanet about the people behind SFP. The most moderate conclusion is that it is a front for persons connected with the Council.

The mention of the term 'scandal' brought forth strenuous denials from both Mr.??? and Councillor **** that there was anything untoward going on here. Councillor ***** emphasised that the matter had been referred both to the District Auditor and the Council's own Compliance Officer and both had pronounced themselves satisfied with the probity of the proposed transaction.

??? tried to pour scorn on all of our points. He claimed that he had overheard all manner of wild rumours which he claimed were common fare among the locals but which were all spurious.

David then raised the matter of the planning application which had still not materialised. Mr.??? replied by saying that such application was 'imminent' although he went on to admit that he was expecting it in 'four to six weeks'. He also went to great lengths to point out the complexity and expense involved in making the application which, of necessity, had to include plans for highways, drainage and such.

When pressed for information about the directors of SFP he claimed that all relevant information would be made public as soon as the development deal was signed, which would be in about a month. He also stressed that the development contract provided that SFP did not get paid until the development was complete so this was more or less a guarantee that the land would be properly developed.

He went on to declare that all matters were in hand and he was quite confident that the deal would go ahead as planned.

However, the letter from SBP disclaiming all association with SFP threw him off balance. We followed by pointing out that the SFP business stationery carried the SBP Geneva address. He tried to claim a continuing interest from Whitbread, but was again thrown by a report of the conversation between Jamie Cowen, the Acquisitions Manager of Whitbread, with **** on the 26th August, disassociating Whitbread from all further involvement in the Pleasurarna redevelopment.

??? argued that Whitbread was not directly a financial backer, but had only considered running the hotel. David countered by arguing that the claimed fact of Whitbread involvement would be sufficient to get meetings with financial backers who might otherwise not be interested.

Again, ??? was visibly embarrassed.

We explained that the media were already aware of this matter and that it was only a matter of time before ??? and **** began to receive telephone enquiries from the media. He asked how much experience they had of dealing with such questions.

We pushed hard with questions about compliance with all relevant laws and regulations. No satisfactory answers were given. We then asked about the delays with the planning application. ??? answered that the delays would not be endlessly tolerated, and that the matter would be reconsidered if no application had been received by November 2003.

We then asked Cllr ****l: "Did you check with SFP that any profits from the redevelopment would be retained in the United Kingdom for payment of United Kingdom taxes?"

The rejoinder: "Why not?" The answer: "It never occurred to us to do so." ??? tried to argue that such a requirement was unreasonable, since it was like demanding to know the bona fides of anyone buying a property at auction. Our reply was that an auction, in which goods went to whoever had the money, was entirely separate from a tender, in which a continuing relationship was contracted on the basis of more than price. We asked at this point about the Proceeds of Crime Act.

***** said he knew who was behind SFP, but was unable to say until closer to the signing of a contract of sale. However, he did confirm that Shaun Keegan was a Director of SFP.

We raised the A.J. Brown proposal, noting that plans were available and that the company had a definite presence in the United Kingdom, and that it was backed by parties known to have unlimited resources for any redevelopment. He asked why Thanet had decided to continue with a very suspicious transaction when this one remained on offer. No satisfactory offer was given.

<Removed> that the questions being asked were logically distinct from the reasons why they were being asked. <removed>. He replied: We are not accountable to any electors, or under the law, or to the

You are. You might try responding to our questions when they me put to you by the media. by asking who is paying their salaries. It will not do.

??? was uncomfortable for most of the meeting and took the earliest opportunity to withdraw. We had expressed disapproval of his presence at the beginning of meeting, but accepted his presence when told that he would be useful to answer questions of detail.

However, as said he -soon gave up on trying to dominate the meeting. When we turned to political matters, he withdrew.

**** revealed to us that the deal would already have gone through had Labour won the last elections, and that he had referred the matter to various modes of inspection, and that he had also demanded a £250,000 bond from ISPP.

REPORT ON THE PROPOSED SALE AND RE-DEVELOPMENT OF THE PLEASURAMA SITE. RAMSGATE

AS AT 12th NOVEMBER 2003

This report is based on the investigations carried out by the Committee for the Improvement of Sandwich Bay.

Appended documents are all copies of documents that are in the possession of the

1. This report concerns the events surrounding the derelict site of former 'Pleasurama' which is situated in a prime seafront location on the Ramsgate Marina and is owned by Thanet District Council.

2. In 2002, the Council (then Labour-run) made the decision to sell the land for redevelopment and invited appropriate tenders. Some 70 tender offers were received by the Council from which a shortlist of the two most suitable offers was finalised.

3. The two 'finalists' were, on the one hand, a consortium of local businessmen led by a local Chartered Architects A. J. Browne & Co and, on the other, was a company called SFP Ventures Partners Limited (SFP). A.J. Browne & Co is a locally based firm with a track record of successful development in the area and proper financial backing. So keen was A.J. Browne & Co to publicise their plans (which included a swimming pool and amphitheatre for use by local residents) that they issued a press release about their proposals which appeared in the Thanet Times edition of 19th November 2002 (Appendix 1). Nothing was known about the identity, backers or proposals from SFP.

4. At a Cabinet Meeting which took place on 22nd November 2002, the Council decided to award the development contract to SFP. Among those Councillors present at that meeting was the future leader of the Council, Mr ************. a local businessman and proprietor of a carpet shop in the Thanet area.

5. Brief announcement of the Council's decision appeared in the local press but without mentioning any details or specifics. To this day no details of the SFP offer appear to have been made public. However, A. J. Browne & Co had managed to ascertain from local sources that the SFP offer included the construction of a hotel and that Whitbread PLC had agreed to take over the running of that hotel once complete.

6. Despite the go-ahead having been given to a development company, local residents saw no sign of any activity on the site. Neither did any application for planning permission manifest itself. This caused some concern as the site is one of central and major significance and its development was eagerly anticipated by local residents who expected it to provide a boost both to the amenity and economy of the area.

7. In February 2003, Mr. Anthony Browne of AJ. Browne wrote to Thanet DC to request details of the SFP Proposals. He received a reply from the Head of Planning and Regeneration, Mr. P. ???, advising him that all matters were subject to contract and, therefore, privileged. (Appendix 2). Mr.Browne found it very odd that an important matter of the development of public property should be protected by alleged privilege.

8. In May 2003, the Local Council elections saw the Conservatives take control of Thanet District Council and Mr. **** was appointed as leader of the Conservative Group.

9. Again in May 2003, a group of Conservative supporting local residents formed the Committee for the Improvement of Sandwich Bay. The Committee was formed in direct response to the Conservative victory in the local elections. The purpose of the Committee was to work with the new administration with a view to improving the amenity of the area. Given its importance and prominence the Committee decided to give the Pleasurama site priority attention. 10. On 4th June 2003, The President of the Committee wrote to Mr. ??? requesting information about the site and progress in respect thereof. (Appendix 3).

No response was received. On 19th June 2003, POTC wrote again to Mr. ??? (Appendix 4) and also to Mr.****(Appendix 5).

11. Mr. ??? did reply on 25th June 2003 (Appendix 6) but only briefly and enclosing a copy of the Council Minutes for a meeting scheduled to take place on 26th June 2003 (Appendix 7).

12. Committee members made a search of the UK Companies Register but could find no mention of any company called 'SFP Ventures Partners Ltd'.

13. The Minutes for the Council Meeting reveal a number of germane points:

(i) A legal dispute involving a Mr. J Godden and a company called Blueridge Properties was not resolved until 3rd June 2003 (Clause 3.2)

(ii) It was expected that a development agreement would be agreed and implement by the end of June 2003 (Clause 3.3)

(iii) Although it is mentioned that Whitbread PLC withdrew from the arrangement, it is still mentioned that they were 'reconsidering' their position (Clause 3.5)

(iv) This project is being partly financed by the public purse at both national and EU level (Clauses 3.8 to 3.11)

14. In the hope of obtaining clarification of matters, members of the Committee attended a meeting with Mr. ??? and Mr. at the Town Hall on 7th July 2003. At that meeting, we were assured by both of these gentlemen that all matters were proceedings normally and that an application for planning permission from SFP was expected in 'four to six weeks'. Mr. ??? further advised that SFP were an arm of a Swiss merchant bank of the same name and so finance for the deal was no problem. He also confirmed that SFP were, in fact, registered in the British Virgin Islands and that was the reason why no trace of that company appears in any UK database. When pressed for further information about SFP, its directors, offices and beneficial owners, Mr. ??? claimed that he was not able to divulge such information.

15. As a result of the information obtained from the meeting, the Committee made further investigation into SFP from which the following was learned:

The British Virgin Islands does not maintain any sort of publicly accessible Companies register.

It is a well-known tax haven.

Until 2002, it was on an OECD 'blacklist' as one of many territories not cooperating with international attempts to curb money laundering.

SFP Ventures Partners Ltd has no office or other presence in this country.

There is a Swiss Bank called 'SFP' (Societe Financiere Privee) though it changed its name to 'SBP' (Societe Bancaire Privee) in January 2003.

SBP made a substantial loss in the 2001-2002 trading year.

It does not appear to have any presence outside of Switzerland.

It is likely that the bank is forbidden by Swiss law from engaging in land developments outside of Switzerland.

15. The Committee also obtained a photocopy of the business card of a Mr. Shaun Keegan which bears the name and address of SFP Bank (now 'SBP'). The Committee learned that this gentleman was distributing this card to local residents in 2002.

16. Because suspicions had been aroused, Dr. ???? wrote again to Mr. ??? on 10th July 2003 (Appendix 8) requesting confirmation as to the bona fides of SFP. Mr. ??? non-committal and evasive reply is dated 29th July 2003 (Appendix 9).

17. The Committee resolved at this time to seek a further meeting but this time with Mr.**** himself, in the hope that we could get to the bottom of these matters as Mr. ??? was, for whatever reason, unwilling to co-operate.

18. On 4th August 2003, the Committee wrote to the Chairman of SBP (formerly 'SFP') in Switzerland requesting answers to the questions we had raised with Thanet District Council but which had not been answered satisfactorily or at all (Appendix 10)

19. The Committee received a brief reply from the bank dated 12th August denying that SFP Ventures Partners Ltd were either wholly or partly owned by the bank (Appendix 11).

20. On 12th August 2003, the Committee wrote to Mr. Jamie Cowan of Whitbread PLC to ask them to confirm whether or not that company was still concerned with the Pleasurama development. (Appendix 12)

21. The Committee wrote to Mr. ??? again on 15th August 2003 (Appendix 13) setting out, in details, the information that was still outstanding and to which the Committee, as local residents, were entitled to request. The letter also mentions the lack of progress in regard to the site which was now becoming a matter of considerable concern to local residents and the subject of unsavoury rumours as to the probity of the alleged redevelopment deal.

22. On 26th August 2003, . ??? spoke on the telephone to Mr. Cowan regarding the letter of 12th August. Mr. Cowan confirmed that Whitbread PLC had initially shown interest in the deal but had subsequently pulled out because 'the numbers did not stack up'. He further confirmed that Whitbread PLC had no further interest in the project whatsoever.

23. Mr. ??? responded again with a letter of 26th August 2003 (Appendix 14) which simply re-states previous non-committal positions and vague assurances. His 'replies' to the questions raised are obtuse (he claims not to know what is meant by 'tangible or authorised presence in the UK'), evasive (he seems unwilling to reveal any information about the identity of the officers of SFP) or simply dismissive. The Committee members were increasingly frustrated by this behaviour.

24. A further meeting with Mr.**** was finally secured for 8th September 2003. Mr. ??? also attended.

It was put to Mr. *****l that it appeared that the Council was proposing to enter into a substantial arrangement with a developer which had no known presence in the UK, which was based in an offshore tax haven and which falsely claimed to be a subsidiary of a Swiss bank. The whole matter was shrouded in secrecy and had all the appearance of a scandal. Various rumours were circulating among the local residents, the most temperate of which was that SFP was, in fact, a front for actual members of the Council. All of this was strenuously denied by both Mr. **** and Mr. ??? who maintained that there was nothing untoward going on here.

Mr. ***** advised that the previous Labour administration had not followed proper procedures and that he had rectified this by referring the matter to the Council's own compliance officer for approval and the District Auditor. Both officers had approved the transaction. He also said that he had demanded a development bond for some £250,000.00.

Mr. ??? attempted to pour scorn on any allegations and claimed once again the SFP were a perfectly respectable company backed by a Swiss Bank. He was shown the letter from SBP dated denying any connection with SFP which seemed to take him by surprise.

Mr. ??? also reiterated that Whitbread PLC were involved with the deal and seemed equally taken aback when he was advised of the contents of the telephone conversation between Mr. Cowan and POTC referred to in point 22 above.

It was put to Mr. ??? that it was possible that the Whitbread PLC name and reputation was being falsely used in order to enhance the bona fides of the developers. Mr. ??? denied this.

Mr. ??? claimed that 'all would be revealed' in a press release due in about a month and that he expected a planning application in 'about four to six weeks' (again!)

Mr.**** was reminded of the sad provenance of scandals that have blighted the Conservative Party and which seem to come, most crucially, just at the moment that the Party is experiencing a revival in its electoral fortunes.

Both Mr. **** and Mr. ??? were reminded of the law governing the behaviour of local authorities and as contained in the Local Government (Model of Conduct) Order 2001. Both men said that the law had been complied with.

The question of whether the profits from this venture were going to be subject to UK taxes. In response both men said they had not given any consideration to that matter.

When pressed to reveal the identity of the people behind SFP, Mr. ??? again refused to answer although Mr. ****, when pressed, did admit that Mr. Shaun Keegan was a director.

When pressed, Mr. **** also confirmed that he would not be prepared to let this matter 'drag on'. If no progress had been made by October/ November he would demand that good reasons be given as to why.

25. On 10th September 2003, the Committee wrote again to the Chairman of SBP to enquire as to whether they had any connection with Mr. Shaun Keegan (Appendix 15).

26. Also on 10th September 2003, the Committee wrote to Mr. ??? expressing their dissatisfaction and disappointment at his failure to provide information in this matter and setting out the reasons why his previous responses had been so inadequate (Appendix 16). No reply has been received.

27. A further letter was sent by the Committee to Mr. Cowan of Whitbread PLC warning him of the possibility that the good name and standing of his company was being used to artificially bolster the bona fides of the Pleasurama development deal (Appendix 17).

28. SBP replied to the Committee on 2nd October 2003 confirming that they had 'no participation in SFP Ventures Partners Ltd' (Appendix 18).

29. On 1st October 2003 the 'Kent on Sunday' newspaper ran an article on the arrest of Conservative Thanet Councillor Colin Kiddell on charges of fraud arising from a development deal involving the 'Dreamland' site in Margate (Appendix 19).

30. On 16th October 2003 the report of the District Auditor into the handling of the previous sale of the Pleasurama site was published. The report was very damning of the previous Labour-run administration and highlighted many instances of mismanagement and incompetence. Note: the present deal with SFP was agreed by the previous Labour administration.

31. On 24th October 2003 the Committee wrote again to Mr. **** reminding him that the first anniversary of the agreement was now approaching and that there had still been no progress on the site. The Committee expressed their surprise that a Conservative Councillor of such repute should be seen to do nothing in the face of mounting failure (Appendix 20).

32. On the same date another letter was sent to Mr. ??? expressing the Committee's disgust at the palpable failure to note either any progress on the site or any meaningful response from him to previous enquiries (Appendix 21). There has been no response to this letter.

33. Also on 24th October 2003, the Isle of Thanet Gazette ran an article on the District Auditor's highly critical report on the conduct of the previous administration and the recommendations made as to how matters should be dealt with in future. In the article Mr. *** is quoted as saying that there are 'ongoing negotiations with SFP Ventures' and "We hope that by Christmas detailed plans for the site would have been submitted" (Appendix 22).

34. In the same issue is another article in which current Conservative Councillors denounce the appalling behaviour of the previous Labour administration (Appendix 23).

35. Mr. ******l replied to the Committee by a letter dated 30th October 2003 in which he advised that Mr. ??? had now left the Council and that 'a full set of plans had now been deposited with tour Planning Department' and that the 'Council has acted in a proper manner' (Appendix 24).

Note: there is no evidence whatsoever to support the view that the Council has acted in a 'proper manner'. In fact, quite the opposite would appear to be the case.

36. On 7th November 2003, the Isle of Thanet Gazette ran another article on the proposed development of the Pleasurama site in which Mr. ***l is quoted as saying:"The developers have been working closely with the Council since they were appointed" And "They have held regular meetings to update us on their progress with their scheme and their proposals which are now available for local people to comment upon" (Appendix 25)

No plans have been made public as far as the Committee is aware.

1. The decision to award this tender to SFP was made by the previous Labour administration which has since been found guilty of gross incompetence and mismanagement.

2 The decision was apparently made on the basis of proposals and plans which have

never been made public.

3. It has been consistently claimed that the project has the support of a major publiccompany even though that has not been the case since the beginning of 2003.

4. SFP is a company which is registered in the British Virgin Islands where the law allows companies to keep their records and details occluded from the public gaze.

5. The British Virgin Islands is well known as a tax haven for offshore investors where profits can be put beyond the reach of the UK tax authorities.

6. SFP appears to have no office or presence in the UK.

7. The identity of the officers and beneficial owners of SFP is shrouded behind a veil of secrecy.

8. The identity of the company's financial backers (if any) is unknown.

9. It has been claimed that SFP is the subsidiary of a Swiss bank which has publicly denied any connection with them.

10. Legitimate and reasonable enquiries of the Council have been met with a consistent wall of obfuscation, evasion and misinformation.

11. Despite the passage of 12 months since the tender was given to SFP the Pleasurama site still lies untouched and derelict and there is not even any sign of the oft-promised planning application

The evidence presented in this report has given rise to grave misgivings among the members of the Committee. It seems remarkable that the circumstances surrounding this purported redevelopment would not cause a reasonably prudent Councillor or Council Officer at last some concern. If it transpires that there is a lack of probity in this matter then it would not be very hard for some local or national media organisation to uncover it and make it public.

As redoubtable Conservative supporters, the members of the Committee are particularly anxious about the image of the Party at this delicate time when it appears that a long-awaited turnaround in its electoral fortunes may be afoot. It hardly needs stating that the Party can ill-afford yet another damaging scandal at either local or national level.

We are therefore of the opinion that this matter should be looked into as a matter of

considerable urgency.