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1 Stop directors made millions

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1stopTHE PEMBROKESHIRE HERALD can reveal that 1 Stop Financial Services directors Timothy Hughes and Andrew Rees obtained massive incomes while mis-selling pensions products to nearly 2,000 customers across the UK.

Mr Hughes’ total declared income received during the period October 2010 to November 2012 was £1,511,846, while Mr Rees benefited to the tune of £1,181,437 at the same time.

After obtaining further information from the Financial Conduct Authority (FCA), the Pembrokeshire Herald is able to expand and clarify its article concerning the activities of Haverfordwest financial advisors Tim Hughes and Andrew Rees, who formerly traded as 1 Stop Financial Services.

The Herald can reveal that, while the pair were cleared of dishonesty by the FCA, elements of the conduct that led to the pair being ordered to pay penalties to the Financial Services Compensation Scheme in the region of £500,000, are capable of being construed as sharp practice.

In particular, the FCA highlights how the pair managed to rake off referral fees for themselves from a separate and unregulated company, EGI, of which they were both directors and shareholders.

Mr Rees and Mr Hughes not only obtained commission as introducers of business but fees from their customers in the region of £3,000 a time.

This receipt of financial benefit created a conflict of interest, as 1 Stop advised customers to transfer their pensions into a SIPP in order to purchase an underlying investment when Mr Rees and Mr Hughes had also a financial interest in facilitating the sale of that investment to the customer (through EGI). However, the pair failed to disclose, manage and mitigate adequately this conflict of interest.

Even when a declaration was placed into customer documentation recording the link between 1 Stop and EGI, it failed to mention the financial interest of Mr Rees or Mr Hughes in EGI.

As a result of their actions, 1,959 of 1 Stop’s customers were at risk of having invested a total of £112,331,229, mostly from pension funds including some final salary schemes, into SIPPs which may not have been suitable for them.

The FCA also found that customers’ wishes to securely invest their pension savings in secure products were ignored and risky investments entered into instead. In the case of one customer who wished to adopt a low-risk strategy, their final salary pension fund was channeled into an unsuitable and very risky investment.

In addition, customers including a joiner, builder and a publican were all certified by Messrs Rees and Hughes as having a high level of understanding of risky “wrapper-type” investments involving complex property transactions. The FCA did not believe the records created by 1 Stop in this regard.
49% of those customers affected were encourage to invest in overseas property developments operated by Harlequin Properties. None of those customers received any advice from 1 Stop on the suitability of that overseas property investment.

The Harlequin group of companies are engaged in the development and distribution of overseas property investments and resorts.

On January 18, 2013, the FCA issued an alert to financial advisers about investments in overseas properties bought through Harlequin Property.  In March, the Serious Fraud Office (SFO) announced that it, together with Essex Police, was looking into complaints in relation to the Harlequin group.   Investors who have invested in specific resorts were asked to contact the SFO.

On May 3, 2013 administrators were appointed for Harlequin Properties.

1 Stop customers who invested in risky investments on the advice of Mr Rees and Mr Hughes have been placed at significant risk of potentially losing all of their money.

In light of their personal liability for the negligent and incorrect advice tendered to their customers, Mr Rees and Mr Hughes were both banned from performing any significant influence function in relation to any regulated activity, carried on by any authorised person, exempt person or exempt professional firm.

In both cases, the FCA decided to impose that penalty neither Mr Rees nor Mr Hughes were judged a fit and proper person in terms of competence and capability.

Harlequin Property are the primary agent for Harlequin Hotels and Resorts, who they say create luxury five star resorts in various locations across the Caribbean. Their mission statement is to,
‘deliver excellent long term returns on clients’ investment by selecting property developments in the most desirable locations’.

The Serious Fraud Office told The Herald that: “The SFO, together with Essex Police, continues to investigate the Harlequin group of companies. We are not able to comment on the on-going investigation nor are we able to comment on an individual’s particular investment.”

In 2013 Harlequin were caught up in a mortgage scandal that saw investors in their properties put at risk of losing around £400 million of deposits.

Investors in Harlequin’s various property ventures and hotel resorts were required to pay a deposit of 30% of their property’s price to secure their investment. Where investors needed to take out a mortgage to pay for the remaining 70% of the property purchase, Harlequin offered to provide a loan which the investors could pay back upon completion.

However, investors were then asked to find around £157,150 each to pay for the properties without the aid of Harlequin’s ‘value guaranteed mortgage’.

Gareth Fatchett, partner at Regulatory Legal speaking in New Model Advisor, said, “Only 2% or respondents could complete without a mortgage, which means 98% of people will go into breach of contract, and Harlequin is saying if they don’t complete their payment they’ll lose their deposit. Advisers should have known from the outset there was not a mortgage available. I’d go so far as to say we’ve seen no evidence of a mortgage relating to a Harlequin property. I suspect the 10% or 15% commissions may have made advisers not check. It’s a huge mis-selling [scandal]. Advisers knew the people they were taking into these contracts couldn’t afford to complete, so therefore the mortgage was by far the most vital thing.”

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Business

Saundersfoot centre site redevelopment scheme withdrawn

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PLANS for the redevelopment of an ‘eyesore’ piece of land in the centre of Saundersfoot, which the local community council feared would “set a precedence for future overdevelopment,” have been withdrawn.

The proposals for the vacant brownfield site between the rear of the former Cambrian Hotel building and the rear of the town houses in Milford Terrace were to create 24 new homes and a 445 square foot commercial unit space fronting on to Milford Street.

Its new developers said it would ‘fill the void’ and ‘re-establish a strong streetscape’.

An application to Pembrokeshire Coast National Park planners, by Ventura Properties (Saundersfoot) said it would feature one, two, three and four-bed town houses and apartments.

The site, currently used for informal car parking, is a mix of gravel and tarmac finished land that includes a small access road to the rear of the Cambrian Hotel, which would be maintained the applicants have said.

The proposal sought to complete the mixed development of houses, apartments, commercial space and the redevelopment of the Cambrian Hotel which was granted permission in 2012.

Although the previous developer delivered the town houses and alterations to the Cambrian Hotel, the remainder of the approved development of 16 residential dwellings was not completed.

The previous developer has sold the site to the current applicants on that basis.

The developers have previously stated: “Approximately half of the site remains undeveloped, under-utilised and is a clear ‘gap’ that contributes negatively to the amenity of the local centre. The plot stands vacant (brownfield), previously used as the car park for the old Cambrian Hotel and remains somewhat of an eyesore.

“This proposal seeks to fill the void left along the southern edge of Milford Street. It proposes commercial units to the ground floor and apartments over on the prominent local centre facing street frontage.”

A mix of town houses and apartments was proposed to the heart of the site.

However, concerns were raised by Saundersfoot Community Council, which did not support the scheme.

Issues raised included the impact on the character of the village’s conservation area, road safety issues, and “even more commercial buildings being offered in a village where new business properties are empty or applications for the change of use are being made to this Planning Authority”.

It warned: “If this application were to be approved by the Planning Authority, the Saundersfoot Community Council are concerned that it would set a precedence for future overdevelopment, which does not preserve nor enhance the character or appearance of a historic village within a conservation area.

“Saundersfoot Community Council does not support this planning application and requests that the planning authority consider refusal of such.”

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Business

Former Pembroke Barclays to become shopfront and residential apartments

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Plans to convert a former Barclays Bank branch on Pembroke’s Main Street to retail and residential apartments have been given the go-ahead.

Mr Zouras, through agent RPC Design & Architecture Ltd, sought permission from Pembrokeshire County Council for a change of use and conversion of the former Grade-II-listed bank at 35 Main Street to retail on the ground floor and residential apartments at the rear ground, first and second floors.

The branch closed in July 2019, the same year the bank’s Narberth and Milford Haven branches closed.

A supporting heritage statement said: “The three-storey building is currently vacant and was a former bank on the ground floor. The first floor was former staff rooms and male/female toilets. The second floor was used as storage. There is an existing outdoor paved area and private, off-road car parking to the rear for four to six cars.  The building is Grade II listed; designated in 2005.”

CADW’s listing says: “…earlier C19 terraced house, front remodelled in 1925 for Barclays Bank to plans by J. H. Morgan of Carmarthen. The building was then called Bank House, but it is not known how long it had been a bank.”

An officer report says: “The ground floor shopfront is six bays wide divided by faceted pilasters of ashlar stone – a hint towards the art-deco style. Heavy fielded panel doors to the left-hand bay. Heavy classical stucco window surrounds to upper floors, the middle window has a pediment above – conventional Edwardian Bank detail, old fashioned for the 1920s.”

The listed building application was conditionally approved by county planners.

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Business

How Small Businesses Can Build Strong Teams

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In the moving world of business today, small businesses encounter obstacles to staying competitive. A vital factor contributing to their success is the ability to form teams. Small businesses can unleash their potential and achieve sustainable growth by building motivated teams. This article will explore strategies small businesses can use to establish teams, foster a collaborative work atmosphere, and deliver outstanding outcomes.

Setting Clear Expectations

Establishing expectations is crucial for developing a team. Small businesses should clearly communicate their objectives, values, and performance metrics to ensure everyone starts on the same page. By defining roles and responsibilities, employees align with common goals and feel empowered to perform efficiently. Transparent communication also sets forth guidelines on deliverables, timelines, and quality standards, promoting accountability across the team. Tips for team building can also be exchanged and implemented for a stronger team with everyone’s opinions and values in mind.

Encouraging Continuous Learning

In today’s changing business environment, small businesses must emphasize learning within their teams. Encouraging employees to acquire skills and broaden their knowledge benefits both individuals and the organization. Organize workshops or training sessions regularly to address industry trends or explore areas that could enhance productivity. Initiatives such as these not only lift employees’ spirits but also enhance productivity by providing the team with valuable knowledge and skills.

Promoting Transparent Communication

Effective communication is crucial for teamwork. Small businesses should aim for an environment where all team members feel comfortable sharing their thoughts and ideas. By promoting open communication through team meetings and collaboration tools, businesses improve the flow of information within the organization.

Managers play a huge role in listening to team members’ opinions and concerns, which helps them feel valued and ultimately boosts job satisfaction. Encouraging interactions among colleagues fosters relationships, reduces stress, and promotes better collaboration.

Supporting Teamwork

In a market, collaboration among team members is essential for businesses aiming to grow. Encouraging functional collaboration can lead to innovative ideas and enhanced problem-solving abilities. Collaboration also creates a work environment where employees feel united and responsible for achieving shared goals.

Small business leaders should prioritize teamwork by organizing projects or team-building activities that promote trust and respect among colleagues. These activities could include brainstorming sessions, platforms for sharing knowledge, or participating in community service together. By fostering collaboration, small businesses are better prepared to tackle challenges as a group.

Recognizing and Appreciating Achievements

Acknowledging employees’ accomplishments boosts their dedication to the team and strengthens the connection between management and staff. Small businesses should implement a recognition program that highlights performance at both team levels. Publicly celebrating successes motivates employees and also encourages others to strive for greatness.

Offering Opportunities for Growth

Supporting development is the key to cultivating teams in small businesses. Providing growth opportunities like mentorship programs, skill enhancement workshops, or financial aid for education helps attract and retain talent. By investing in employee growth, businesses foster loyalty while grooming individuals to assume leadership roles in the future.

Inclusive Decision-Making Process

Small businesses can unlock the potential of their teams by involving all members in decision-making processes whenever possible. Encouraging inclusive decision-making empowers employees, giving them a sense of ownership over their work and fostering commitment to shared objectives. Embracing different perspectives enhances creativity and reduces biases, leading to well-informed decisions that benefit the organization.

Maximizing Employee Well-Being

Maintaining employee well-being is critical to building strong teams within small businesses. When employees feel supported and valued, their productivity and satisfaction levels significantly increase. Small businesses can prioritize employee well-being by implementing measures such as flexible work arrangements, promoting work-life balance, providing wellness programs, and fostering a positive work culture.

Flexible work arrangements allow employees to control their schedules, balancing personal responsibilities while meeting professional commitments. This flexibility can lead to higher job satisfaction and reduced stress levels among team members.

Closing Thoughts

Establishing teams is crucial for businesses seeking long-term success in a competitive landscape.By establishing guidelines encouraging education, nurturing open dialogue and teamwork, acknowledging accomplishments, offering avenues for development, and incorporating inclusive decision-making practices, companies can cultivate strong teams that excel at sparking creativity and attaining impressive outcomes. Robust teams not only assist enterprises in surmounting obstacles but also lay the groundwork for future expansion and success.

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