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Land Plotters

Intro

'All investors are fully aware that the land sold does not have planning consent neither is that planning consent guaranteed for the future.  There is no "spin" and our clients do not say that land "will" be zoned for home buildings.  Their promotion materials state clearly to investors that planning permission cannot be guaranteed.' Farrer & Co 25th October 2004

There are always fashions in investment opportunities. Selling plots of land that may be granted planning permission in the future is just one of the latest investment schemes.

It has to be said it has its attractions. We would all like turn a £90,000 stake into a turnover of more than £3 million. All you have to do is to buy some agricultural land in the green belt in the crowded southern part of England close to an expanding town. Divide it up into nominal plots and then flog it off at a generous profit to punters prepared to think that their plot will soon be given planning permission, so their plot will shoot up in value. The plots are generally nominal or paper ones. It is rare for them to be marked off by fences etc. Indeed some concerned local councils, such as Milton Keynes, have passed Article 4 Directions to prevent plots being fenced off or physically divided in some other way.

A decidedly decent profit beckons for the original land purchasers but what about those who buy the plots? Anyone expecting a quick profit, apart from those selling the plots of agricultural land, is clearly high optimistic. The odds may not be quite as long as on throwing fistfuls of fivers over a cliff into the sea and getting a return or investing in a pipe of vintage character Port but they are not good as solicitors Farrer & Co make abundantly clear in their letter (above) of 25th October 2004.

These plotting schemes have attracted considerable Press comment both in the UK and Australia and have also been mentioned in the House of Commons. As well as being a decidedly long shot for investors, land plotting is a potential nightmare for local councils. Trying to trace a number of owners of small plots of land in ten or twenty years time seems all too likely to prove to be an administrative nightmare. Even, at the present time, land plotting may actually dissuade councils from granting planning permission.

Among those involved in land plotting is Stephen Cleeve, believed to be the only man yet to have offered vintage character Port in 1996 as an investment. Despite numbers of duty rises a bottle of vintage character Port in Sainsbury's supermarkets is exactly the same price now as it was in May 1995. European Land Sales Partnership (ELSP), founded by Cleeve and his former partner - John Beckwith-Smith - is offering plots in various parts of the country. Other companies also mentioned in Press articles during 2004 include English Land and Baron Deschauer's Bluebell Land and Warrengate (Herts) - both based at 184 Broadhurst Gardens, West Hampstead, London NW6 3AY.

Solicitor Paul Smith of the Malt Whisky Buyers Helpline (01539-729580) has been looking into some of these schemes on a pro bono basis. Smith's investigations have led to a series of letters from Royal solicitors Farrer & Co, who represent Stephen Cleeve.

  Latest News
 

UK Land Registry leaflet on land banking
(Posted 10th March 2009)

UK Land Registry has published a useful advisory leaflet on land banking: www1.landregistry.gov.uk/assets/library/documents/public_guide_021.pdf

The leaflet’s introduction gives a stark warning: This guide is intended to alert the public about ‘land banking investment’ schemes that are often advertised as offering big returns on investments in land. Many investors have handed over thousands of pounds for land that has little or no chance of ever being developed.

February 2008: probably a score draw for Stephen Cleeve
(Posted 4th March 2008)

February 2008 may have been a bitter-sweet month for Stephen Cleeve: sweet because on 7th his eight-year qualification as a company director came to an end but bitter because as a Chelsea fan he wouldn’t have relished his team being beaten by Tottenham in the Carling Cup.

End of a partnership
(Posted 26th October 2007)

investdrinks has been informed that John Beckwith-Smith is no longer a partner with Stephen Cleeve nor is Beckwith-Smith an investor. The partnership was ended by mutual agreement in March 2007.

Legal defeat for Stephen Cleeve
(Posted 24th August 2007)

Possible launch of Cleeve-balls

investdrinks is considerably distressed to learn that our entrepreneurial  friend, Stephen Cleeve, has suffered a rather severe and probably costly legal defeat. Cleeve has been attempting to close down the site - stephencleeve.com - that is sharply critical of our enterprising friend’s business practices. Cleeve claimed that his registered trademark - ‘Stephen Cleeve’ - was being deliberately tarnished and his business disrupted by the web site bearing the same name. Also he asserted that the owner of the site had no right to the name ‘Stephen Cleeve’.

Cleeve took his case to the WIPO (World Intellectual Property Organization) Arbitration and Mediation Center and the judgment was published on 16th August.  Under the rules of the WIPO a complainant must clear all of the following three hurdles for success. Firstly: ‘the domain name is identical or confusingly similar to a trade mark or service mark in which the Complainant has rights’; secondly: ‘the Respondent has no rights or legitimate interests in respect of the domain name’; and thirdly: ‘the domain name has been registered and is being used in bad faith’.

Cleeve won on the first count but failed on the other two. On the second the panel found that ‘the Respondent’s use of the disputed domain is to establish a web site for criticism and commentary about the Complainant’s business activities.  This constitutes legitimate commercial use and fair use within the meaning of the policy.’ The panel noted that Cleeve registered his name as a trademark on 8th November 2006 - over a year after the web site was registered on 3rd August 2005. On the third count the panel found that there was no evidence the registrant of the web site intended to sell it to Cleeve nor that it was being used for commercial gain. ‘On the contrary, the Panel finds that the primary purpose of the Respondent’s web site is for criticism and commentary of the Complainant’s business activities.‘ The panel said that Cleeve’s claims that the web site was defamatory and libelous was beyond the scope of the panel and that ‘to the extent that the Complainant wishes to pursue the issue should in the panel’s view be adjudicated in an appropriate judicial forums’.

(To view the full judgment, please click here.) A report on the case can also be found at out-law.com/page-8404.

Cleeve was represented by Simon Smith of Schillings, Dean Street, London W1. Although the name of the firm of solicitor sounds reassuringly cheap, investdrinks suspects, however, that bills for Mr Cleeve’s learned friend’s services feature pounds rather more prominently than schillings. The law firms site (schillings.co.uk) says that ‘Simon specialises in defamation and all other aspects of media litigation including privacy, confidence, copyright and contract.’ He has successfully represented a number of high profile individuals and companies.

investdrinks fears that Mr Cleeve may be facing a considerable legal bill. As ready to offer assistance investdrinks wonders whether this is the moment to launch an appeal to assist Mr Cleeve in an hour of need. In time it might become a celebrated appeal like Private Eye’s Goldenballs, it may be appropriate to call this new appeal Cleeve-balls. investdrinks would be happy to hear from anyone as to whether such an appeal (or fighting fund) would be appropriate. If the response is positive and to get the ball rolling investdrinks would be ready to contribute three Zimbabwean dollars to open the fund.

investdrinks is aware that this is but a small gesture but that given Mr Cleeve and his trademark’s investment expertise I’m sure that our enterprising friend would soon be able to triple its value. After all it was Stephen Cleeve and Forrester & Lamego Ltd that proposed pipes of Vintage Character Port as an investment back in the mid-1990s. Although the value of Vintage Character Port has not grown quite as much as Stephen Cleeve anticipated - for example a bottle of Sainsbury’s Vintage Character Port cost £6.49 in May 1995, while in May 2007 the equivalent - Sainsbury’s Finest Reserve Port - could be purchased for £5.99, it was still doubtless a bold and visionary proposition. The trademark ‘Stephen Cleeve’ offers ‘investment services relating to investments’. investdrinks was a little surprised not to find ‘Stephen Cleeve’ on the Financial Services Authority’s register but doubtless FSA approval will soon be forthcoming.

Crawley into small plots?

investdrinks has been also been intrigued to learn that Cleeve’s partner, John Beckwith-Smith is now the contact for the Grosvenor’s (Grosvenor Estates)  joint development plans with Crawley Borough Council to produce a ‘new vision for Crawley’. investdrinks wonders whether this involves dividing Crawley into small plots that can then be offered as an investment. Details of the development project along with a contact email for Mr Beckwith-Smith can be found on grosvenor.com/Portfolio/Crawley.htm. investdrinks has emailed Beckwith-Smith to ask if land plots will be part of the development plan and will report back.

Trademarked Stephen Cleeve™ to become a global brand?
(Posted 23rd April 2007)

Occasionally one is privileged to be in at the beginning of something really big - this may be just such a moment. investdrinks has learnt that Stephen Cleeve is well on the way to being a trademark™. Surely this may well be just a first step towards global brand recognition. Doubtless advertising agencies are even now considering how huge they can make the Cleeve™ brand. Some may well be dusting off previous advertising slogans such as ‘snap, crackle and pop’, ‘the mint with the hole’ or ‘you'll wonder where the yellow went when you brush your teeth with Pepsodent’ that with a suitable tweak could do the business. The trademark application form shows that the push behind this nascent global brand is being organised from 9 Stadium Street, London SW10 0PU.

From the Campaign to Protect Rural England
(Posted 5th January 2007)

Landbankers selling rural England by the pound
(released 15th December 2006)

Countryside campaigners CPRE [1 - see notes at end] today (Friday) launch a campaign against a growing carve up of England’s countryside. It leaves fields and woods at risk of being disfigured and neglected. [2]

Small investors from across the globe are being sold plots of rural land on hundreds of sites across England in order to build homes on them. Their chances of success are very low and their ‘investments’ are likely to fail, because permission to develop cannot be obtained on the great majority of the land. But that has not stopped more than two dozen separate ‘landbanking’ operations from using glossy advertising and high pressure sales techniques to lure in gullible investors.

CPRE fears top economist Kate Barker’s review of planning, commissioned by HM Treasury and published last week, could pour fuel on the flames of small investor landbanking. [3]

She called for a major review of Green Belt boundaries across England. Landbanking operators may use this to advertise hundreds more plots on Green Belt land for sale, claiming their protected status may soon be lost following the Barker review.

CPRE is combining with MPs from all parties to call for the Government to clamp down on the schemes. Greg Mulholland, Liberal Democrat MP for Leeds North West, has today issued an Early Day Motion (494) supporting our campaign. [4]

CPRE has found nearly 30 operators involved in buying up land in open countryside and subdividing it into small plots, sometimes with stakes and fences. They then market the plots, mostly via the Internet, as having potential for development, with inflated prices to match.

Yet they do not have the necessary authorisation they need, both from planning authorities and the Financial Services Authority, to realise the potential they refer to - and little hope of ever getting it. Many use seductive but highly questionable claims to suck in investors from all over the globe. [5]

CPRE has surveyed the activities of these companies and found some 200 separate sites across England’s countryside are affected. [6] Once subdivided and sold, the sites are at risk of being disfigured or neglected. [7]

The Government has recently proposed a small change in planning law to prevent the landbanking operators from subdividing land into small plots with unsightly fences and posts. CPRE welcomes the proposal, but on its own it will not be enough to tackle the growing problem. [8]

Much more needs to be done across Government. Councils need to be able to remove fences and stakes already in place, and Government urgently needs to use the powers it has in company and property law to curtail the landbanking operations.

Mark Prisk MP (Conservative, Hertford and Stortford) said:
‘It’s high time the Government acted. In Hertfordshire and across the UK, this landbanking is bad for our countryside and even worse for people tempted to speculate.’

Colin Challen MP (Labour, Morley and Rothwell) said:
‘The trend towards speculative landbanking needs to be arrested, and I hope that the collapse recently of a landbanking company will make people think twice about this capricious threat to our Green Belt. At a time when market pressure, as opposed to sound planning policy, appears to be the preferred post-Barker approach to housing supply, we need to carefully consider who would actually benefit. Landbanking should be discouraged - it is speculation against the countryside.’

Greg Mulholland MP said:
‘Ordinary people are being ripped off and at the same time landbanking scams are causing real distress to many local communities who are worried that important local sites, including in Green Belt land, will be built on. It is time the Government tackled this, to stop people being conned and to protect Green Belt land for future generations to enjoy.’

Paul Miner, CPRE’s Planning Campaigner, said:
‘In Australia they have clear laws to stop this practice and are using them. [9] We shouldn’t have to tolerate it here either. The Department for Communities and Local Government, the Department for Trade and Industry, the Financial Services Authority and the Office of Fair Trading need to work together and stamp it out completely.’ [10]

NOTES FOR EDITORS

1. CPRE, the Campaign to Protect Rural England, is a charity which promotes the beauty, tranquillity and diversity of rural England. We advocate positive solutions for the long-term future of the countryside. Founded in 1926, we have 60,000 supporters and a branch in every county. President: Sir Max Hastings. Patron: Her Majesty The Queen.

2.  CPRE can supply examples of land that has been despoiled by posts and fencing. We believe much of the farmland marketed by landbanking operators is at risk of neglect as a result of being sold to thousands of small investors, many of whom will never visit their land.

3. Barker Review of Land Use Planning - Final Report, HM Treasury, December 2006.

4. Greg Mulholland MP’s Early Day Motion (494) supports CPRE’s campaign and urges the Government to take action to address the landbanking issue. A clear message on the need for action will be sent to Government by as many MPs as possible signing the Motion.

5. See CPRE’s briefing The Great Landbanking Carve-up. Sites marketed by landbanking operators are generally close to other sites designated for housing in local authority plans, and to a layman would seem likely to be developed in the future. To be able to realise the potential gains from developing the site, the individual plot owners would have to apply together for planning permission for homes and/or designation of the site for new housing in the local development plan or sell their plots collectively to a developer. Most, though not all, of the companies we have encountered are claiming to do one or both of these things. CPRE argues that for this to happen the operation would have to be a ‘collective investment scheme’ in law, and need authorisation from the Financial Services Authority (FSA). To CPRE’s knowledge, no landbanking business has such authorisation. See also footnote 9.

6. CPRE has found that the operators listed in our briefing The Great Landbanking Carve-Up are currently holding and / or marketing approximately 200 sites across England. Details of individual sites and the companies marketing them are available from CPRE’s press office.

7. For example, in Stockport Borough, a field that was once lush grazing land was subdivided into plots by Property Spy. It became overgrown and blighted with fly-tipping as a result.

8. Between August and October this year the Department for Communities and Local Government (DCLG) consulted on proposals for changes to ‘permitted development rights’ which allow landbanking companies to put up any number of fences and stakes on their land. The changes would enable local authorities to remove these rights without first having to refer to the Secretary of State, but not in cases where the fences and stakes were already in place.

9. In Australia, the State Government of Victoria has obtained an interim injunction to stop a range of promotional activities by the European Land Sales Partnership. This action, under Section 150 of the (Australian) Fair Trading Act 1999 prevents the company from showing a promotional video or from claiming that it or any of its agents has expertise in either obtaining planning approval for, or development of, land. The matter has been listed for a full hearing in the state Supreme Court. In the meantime the state Government has issued a public warning, stating that ‘Victorians are warned not to buy or enter into contracts to purchase land with the business or its partners without first obtaining independent expert advice or confirmation from relevant councils or planning departments that the land will, or is likely to be, granted residential planning permission in the near future.’

10. CPRE is calling for an urgent, high level meeting of relevant Government departments and regulatory bodies to prepare an action plan for cracking down on the sale of small plots of land to uniformed investors who have not been given the facts they need to know. Actions we would like to see taken include more active regulation of landbankers by the Financial Services Authority, an investigation of the practice by the Office of Fair Trading, and more freedom for local councils to deal with the visual impact of landbanking through planning controls.

Stephen Cleeve defends Dorset site
(Posted 29th September 2006)

According to a report in the Dorset Post’s Daily Echo Stephen Cleeve and Commercial Land claim to have gone careful research into the King’s Stag site. The partnership will be lobbying for the site’s inclusion in the North Dorset Local Development Framework. This will make ‘the land extremely attractive to developers’. North Dorset District Council has reiterated that there is ‘no chance of the site winning planning permission’.

‘Landbank’ firm hits back at BBC
By Andy Davey (29th September 2006)

A LAND sales company has hit back at a BBC investigation which claimed it had lured investors into spending thousands of pounds on plots of worthless land in North Dorset. The TV programme alleged "landbanking" firm Commercial Land convinced buyers to snap up 5,000 plots it is marketing at a four-acre site near the hamlet of King's Stag, near Sturminster Newton. BBC South's Inside Out series alleged Commercial Land, formally London European Land Sales Partnership, based in London, told investors they could apply for planning permission and sell their plots to developers for huge profits. But North Dorset District Council has revealed that there is "no chance" of anyone successfully applying for planning permission at the site, which it claims has no development potential.

Now Commercial Land, which has kept 50 per cent of the site for itself, has responded, claiming its clients are well aware there is a risk the site may never get planning permission.* But it added that it has carefully researched the housing market in North Dorset and the site outside King's Stag and will be lobbying for its inclusion in North Dorset's Local Development Framework consultation document in 2008, which it claims would make the land extremely attractive to developers. Partner in Commercial Land Stephen Cleeve, said: "Our clients are intelligent people and are well aware of the risks.

"We have found a great piece of land on the edge of a village, with good access and no covenants on the basis that in the next five to 10 years things will change. Some land will be re-zoned, it's just a question of whether it's ours or someone else's." North Dorset District Council's development control manager Nick Fagan told the Daily Echo that there was no chance of the site winning planning permission, not least because the area has a housing surplus. "Unfortunately landbanking appears to be growing increasingly common," he said. (thisisdorset.net/display.var.945514.0.landbank_firm_hits_back_at_bbc.php)

investdrinks adds:
* This is spelt out in Commercial Land’s Terms & Conditions. 4.6 (under The Land Plot - All land sold by CL is without planning permission and is purely open countryside, agricultural or forestry land. CL do not warrant that planning permission will be granted on the land sold by CL at any time.

The following clause (5 - Preliminary Enquiries) also informs clients: The client agrees that they will have no remedy against CL and that CL shall have no liability to the Client in respect of any statement made in the negotiations leading to the agreement other than statements contained in written replies signed by a partner of CL.

Unfortunate publicity
(Posted 27th September 2006)

investdrinks was distressed to learn that our old entrepreneurial friend Stephen Cleeve and his two land banking partnerships, ELS (European Land Sales Partnership) and Commercial Land, received some rather negative publicity on Monday 25th September. John Beckwith-Smith, who works for Grosvenor Limited, The Grosvenor Office, 70 Grosvenor Street, London W1K 3JP Tel: +44 (0) 20 7408 0988 is Cleeve’s partner.

Stephen Cleeve and Commercial Land were the subject of Inside Out on BBC South, who looked at prospects of making money through their land banking schemes. (See below).

Some of the main findings/points of the programme were:

‘scores of investors across the country have been tricked into handing over thousands of pounds for land that has no chance of ever being built on.’

‘Their site at Eynsham is in the greenbelt and in the floodplain.’

‘Commercial Land - which has never won planning consent for any of its holdings - is currently marketing a four-acre site near the hamlet of King's Stag.’

“I feel this company is trying to sell land to people on a fraudulent basis,” Nick Fagan, council planner.

If the company successfully sells all its plots at King's Stag (North Dorset) it will make about £750,000. Its main partner, Stephen Cleeve, paid just £30,000 for the site in September 2005. North Dorset District Council has told the BBC there is no chance of development (at King’s Stag), not least because the area actually has an oversupply of homes. ‘Mr Cleeve, who is banned from being a company director for eight years after a previous investment scam, has already been the subject of a public warning issued by the Australian authorities over his tactics in selling UK land overseas.’

"European Land Sales is a bona fide organisation,” Stephen Cleeve.

Land sales lies lure in investors
by Malcolm Prior Inside Out, BBC South 25th September

It sounds like the perfect deal - buy a piece of the English countryside, apply for planning permission and sell it on to developers for a huge profit. But scores of investors across the country have been tricked into handing over thousands of pounds for land that has no chance of ever being built on. An investigation by BBC South's Inside Out programme has exposed one "landbanking" company that has convinced investors to pay above the odds for sites that have little or no development potential. Commercial Land, based in St Johns Square, London, formerly European Land Sales Partnership (ELS), specialises in buying agricultural land and dividing it into tiny plots, which it then sells to investors at £5,000 for every 0.02 acre. It tells investors they could get a five-fold return on their money if planning permission is granted. What it does not say is that the development potential of the sites it is touting is non-existent.

Three employees tried to convince BBC journalists posing as potential investors to hand over £10,000 for a small piece of land in Dorset that planners are adamant can never be built upon. Commercial Land - which has never won planning consent for any of its holdings - is currently marketing a four-acre site near the hamlet of King's Stag. During a meeting at the company's London headquarters, one salesman claimed the local council had written to them saying the land in King's Stag was "suitable for housing and also for commercial use".

His colleague, who said between £30,000 and £50,000 could be made from a £10,000 investment, claimed the quiet rural hamlet would soon be part of the suburban sprawl, adding "go back there in five, six years down the line and it will be very built up". The company's own in-house planning specialist claimed it would not be long before planning permission - for either residential or commercial use - was secured. He said: "It's just a matter of time to see when we get planning permission in 2008 so it's not too far away. "They [the council] are always saying this is what we need at the moment." In fact North Dorset District Council has told the BBC there is no chance of development, not least because the area actually has an oversupply of homes.

Nick Fagan, the council's development control manager, said of the chances of the site winning planning permission: "Zero, nothing - there's no chance at all of ever getting planning permission here. "We did send them a letter. It said there's no chance of developing this land, basically ever. "I feel this company is trying to sell land to people on a fraudulent basis. They are cowboys and they should be closed down." If the company successfully sells all its plots at King's Stag it will make about £750,000. Its main partner, Stephen Cleeve, paid just £30,000 for the site in September 2005.

Mr Cleeve, who is banned from being a company director for eight years after a previous investment scam, has already been the subject of a public warning issued by the Australian authorities over his tactics in selling UK land overseas. In this country, the Serious Fraud Office - despite deciding not to prosecute Mr Cleeve - has said there is evidence that investors have been misled by ELS in the past. The company's sales tactics have certainly proved a success for Mr Cleeve over the years. In Oxfordshire, ELS made hundreds of thousands of pounds from investors by selling land it said was ripe for development. Investors were not told, however, that the land near Eynsham lies in the Oxford greenbelt and in a floodplain. West Oxfordshire District Council says it will never allow building there. One of the many investors who spoke to the BBC about how they were convinced to part with their cash is Satish Mehta.

The 70-year-old retired GP from Stockport paid £7,600 for his plot back in July 2004 and was told the land was likely to be included in the local development plan. He said that he felt he had been "led up the garden path" and added: "I can see I have been conned." In a statement, Mr Cleeve said that a new member of staff had made a genuine error about the letter, which was actually from the company's planning consultants and contained their view of the council's position on development. He added: "We are not free to discuss our planning processes as this could prejudice our chances of gaining the relevant permission and as such would be doing our clients a disservice.

"European Land Sales is a bona fide organisation and has a strict disciplinary code. Any breaches of our code are dealt with quickly. Several employees have already been disciplined."
(news.bbc.co.uk/1/hi/england/5348290.stm)

Having looked at the commercialland.biz site, investdrinks is much taken with the picture of rural tranquillity on the main page - timeless and unchanging. This may be a subliminal message that on ELS’ and Commercial Land’s current record of never having made a successful planning application this land will remain unchanged and unspoilt for the foreseeable future. Perhaps Commercial Land should be commended for making this clear to their investors?

Although it might seem rather presumptuous, investdrinks wonders whether Commercial Land’s dynamic and entrepreneurial partners - John Beckwith-Smith and Stephen Cleeve - shouldn’t make more of themselves. Neither feature on the ‘about us’ page on both the commercial land site and ELS. investdrinks suspects that potential investors would like to know who the partners are and their backgrounds, otherwise they may conclude that the two organisations are bit like the Mary Celeste.

It would surely be useful to highlight John Beckwith-Smith’s connections with the Duke of Westminster’s Grosvenor Estate. A long shot but a couple of ringing endorsements from the Duke would surely help to counter some of the unfortunate publicity. Just a thought...

Commercial Land is at Knights Court, 6-8 St Johns Square, London EC1M 4DE
Telephone: 020 7250 1000; fax: 020-7324 1560. Email enquiries: info@commercialland.biz Web site: commercialland.biz

Other recent press reports on land banking:
Tony Levene in the Guardian on a move by the UK FSA (Financial Services Authority) to classify land banking as a collective investment and therefore subject to FSA regulation. Also a more recent story in the Guardian about sales of UK plots in India.  These two articles can be accessed on the Guardian Unlimited site.

Landbankers on the back foot
£7m of investors' cash is at risk as firm is suspended. Tony Levene reports

Saturday August 5, 2006
The Guardian

One of Britain's biggest landbanking operations, Land Heritage (UK), has suspended operations, leaving question marks over £7m paid by 700 investors who bought small plots of farmland from the company. The plots were sold to investors on the basis that they were likely to be granted planning permission - and potentially make huge profits. The suspension of Land Heritage (UK) could be followed at other landbanking firms as investor watchdogs target these controversial firms. Landbankers typically buy fields at £3,000 to £10,000 an acre, divide the plot into 0.1 acre parcels, then sell each one for £10,000 to £15,000. Land- banking firms can make as much as £140,000 profit an acre - even if the land does not get planning permission.

Land Heritage (UK) has also sacked its staff of 17 salespeople and 12 back-up staff, giving them just 30 minutes to clear their desks. The suspension of the firm is part of a joint operation by the Financial Services Authority and the Department of Trade and Industry to rein in the 50-plus firms now involved in landbanking - an unregulated investment which could leave punters with worthless land if forecasts about planning permission turn out to be wrong.

Last March, Guardian Money exclusively reported how the DTI shut the Ideal Home Exhibition stall of landbanker United Land Holdings. It wants to put ULH into compulsory liquidation "in the public interest". Land Heritage (UK) says it is "a specialist in sourcing land with future development potential" offering "carefully selected plots of land to provide opportunities for private investors".

Purchase contracts say the firm would organise planning permission and that all individual plots must be sold together to a housebuilder. These sites are generally either in green belt land or are protected from development in some other way. Landbankers say sites will obtain building consent but investors may have to wait up to 15 years. Until the end of last week, Land Heritage (UK) was selling fields comprising 71 acres in Uckfield, East Sussex, and 41 acres in Boston, Lincolnshire.

But late last week, the firm received a letter from the FSA referring to its "guidance on land investment schemes involving planning permission arrangements". The FSA is concerned that landbank sales, hitherto unregulated, should be controlled because they are "collective investments". All purchasers have to act together, as contracts say no one can sell individually or keep the land undeveloped.

FSA control would mean firms and their principals would have to be authorised. It would also mean landbankers could no longer promote sales promising "telephone number" style gains.

The FSA says it has been looking at landbankers for some weeks. "There are things that concern us. When planning permission applications and land sales are managed by the selling company and are out of control of the individual investor, it is a collective investment and as such must be regulated." Investors in failed authorised schemes can claim on the Financial Services Compensation Scheme. United Land Holdings was also shut because it was an unauthorised collective investment. Other operations using the same methods will receive similar FSA letters in the near future. Land Heritage (UK) insiders say they received dismissal notices within minutes of the firm reading the FSA letter.

"We received no notice, no holiday pay, no redundancy and no recent commission. Some are owed £10,000," a salesman told Guardian Money. "As well as our concerns, we are worried investors have not been informed."

The staff intend an employment tribunal action if claims remain unpaid.

Guy Hempill, who resigned as a director two weeks ago but remains a major shareholder, says: "We intend telling investors nothing will happen until we hold a meeting with the FSA in three to six weeks' time. We are taking advice. We have suspended trading while we talk to the FSA about the need for regulation. This is obviously a legal and technical point the whole land investment industry is going to have to address in due course."

Mr Hempill recently set up Ultimate Trader, a new company likely to provide "trader-related investor education" in futures and options. t.levene@guardian.co.uk

From The Guardian, Friday September 22nd 2006
Indians plough cash into false hopes of new homes on English green belt by Randeep Ramesh in New Delhi

Plots of green belt land in England are being sold to Indians for thousands of pounds as one of the best ways to make money. They are being marketed on the basis that vast tracts of the English countryside would soon be covered in homes - and potentially make big profits for foreign investors.

Companies have taken out full-page advertisements in Indian newspapers and also blitzed prospective customers with text messages saying: "Plot available in UK London (sic)". Investing in England's green belt, according to marketing material seen by the Guardian, is "one of the best ways to create real personal wealth".

Landbanking firms typically buy fields for a few thousand pounds, divide them up, and then sell plots for £10,000 each on the basis that, with planning permission, they stand to reap substantial profits. However, local councils told the Guardian that "allowing homes to be built on the land would be contrary to all current, emerging and foreseeable planning policies".

In India, landbanking firms are largely unregulated, although some have been closed down. In London, the Financial Services Authority is concerned some schemes should be controlled because they are "collective investments".

None of this has deterred Indians, who have increasingly large amounts of disposable income thanks to the country's economic boom. They are told that the UK needs to build another 200,000 homes in the south east by 2016 to alleviate an impending housing crisis and some will have to be on green belt land.

One company, UK Land Investments Group, fills its sales material with quotes from John Prescott and photocopies of newspaper articles about why "the green belt has to go". It has offices in London, Dubai and Delhi, and is selling 5,000 acres (2,024 hectares) of green belt to Indians for $25,000 (£13,000) a plot, regardless of size, which is the maximum amount an Indian can send abroad without questions being asked.

One customer is Indian yarn trader Jinendra Jain, 65, who last visited Britain in 1979. He spent £24,000 this year on two small plots around Tunbridge Wells and Bromley, Kent. He reckons that his 600 square metres of England, once granted planning permission, could be worth £200,000. He signed up because of the prospect of big profits - more than 700% - and the fact that prices in India have almost tripled in metropolitan cities, with demand outstripping supply to the extent that the country is short of 25m homes. A luxury five-bedroom villa on the outskirts of Delhi sells for 42m rupees (£480,000).

"I already have eight properties here," he said from his office in Delhi. "In England, I am buying to build. I want a bungalow for my grandson."

However, Maidstone district council said his 350 square metres in Tunbridge Wells is in green belt land which is "an area liable to flood, it was highly unlikely any residential development could take place". His Bromley plot is also in the green belt. The council told the Guardian that "permission will not be given for inappropriate development. The construction of new buildings or extensions would be inappropriate".

"We are aware companies ...do advertise the 'hope' value. This is the first time we have become aware of land of this sort in the borough being marketed overseas," said Andrew Rogers of Bromley council.

Planners in the UK say it is "beyond belief" that English countryside sold to Indian investors would get built on. "The chances of developing green belt land to realise the gain are so slim they are frankly unbelievable," said Louise Brook-Smith, a planning consultant who has worked both in India and the UK.

Mr Jain says that he will shortly send his son to check the land's status.

Rajat Malhotra, an investment manager at UK Land Investments, denied that the company did not highlight the risks. "In India land is sold without any planning permission and by some method, permission is obtained. So in England, why would it be different? Our company will campaign to change the land's status. If not, we will help sell your property."

Debate on land banking in UK Parliament
(Posted 7th August 2006)

There was a debate on land banking in the UK Parliament on 12th July. Two companies were mentioned: English Land Partnership and European Land Sales Partnership. Mr Mulholland cited the legal action taken by the State of Victoria against European Land Sales. He also raised the legal loop-hole that prevents the DTI from investigating partnerships whereas they are responsible for investigating limited companies and plcs.

PARLIAMENTARY REPORT (from Liberal Democrat website)
House of Commons - (Westminster Hall) Land Banking
12 July 2006

Mulholland makes case for urgent action against mis-selling of greenfield land

Greg Mulholland, Liberal Democrat MP for Leeds, North-West

Mr Mulholland said, 'I wish to focus specifically on the practice in which a number of disreputable companies and individuals around the country are engaged: the misrepresentation and mis-selling of greenfield land, which is becoming a critical issue in many rural and semi-rural areas. Before I expand on that, I want to make it clear that my purpose today is to ensure that after the debate the Minister and the Government will agree to work with me and MPs from all parties who are also concerned to address this issue. I shall make some suggestions later as to how that could be achieved.

'Let me define precisely the relevant issues. In broad terms, land banking is simply the practice of purchasing undeveloped land for future developments or resale. That investment often comes in the form of land investment companies or partnerships buying land, subdividing it and then encouraging secondary investors to buy individual plots. If the land value increases, the investment companies gain a high return, and the secondary investors also benefit. In the vast majority of cases, for the value of the land to increase substantially, a "change of use" must be accorded to the land, which means that local councils must grant permission for it to be developed. If it is green belt land, there needs to be a change in status.'

'I come to the specific proposals, for which there are precedents in other parts of the world. As the Campaign to Protect Rural England has highlighted, in Australia in December 2005 the European Land Sales Partnership stood accused of grossly misleading potential investors over its ability to obtain planning permission and the likelihood of planning permission being granted on the tracts of land that it owned. The key difference in that case was that the state government of Victoria was able to act quickly and decisively to bring a halt to the mis-selling. The state legislature obtained an interim injunction order against ELSP, which prevents it from engaging in a range of promotional and marketing activities until there has been a full hearing into its activities, which is due to take place in the Victoria Supreme Court this year. So far, no such decisive action has taken place in the UK. The only course of action for investors who feel that they have been sold land on a false premise or been the subject of misrepresentation would appear to be to pursue cases individually through the courts.

'There is a strong coalition working on this matter. As I mentioned, I am working with the CPRE. I am also working with several MPs from all parts of the House, and I have been contacted by reputable land investment companies, including possibly the largest such company in the United Kingdom, UK Land Investments Group. Firms of that nature are concerned, because they invest large sums to ensure that land is bought and sold legally and without misrepresentation. They wish to see fly-by-night organisations brought to book for their scandalous practices and the damage that they do to the industry.

'We may need new legislation for that to take place or we might simply need the extension or clarification of existing legislation. Sufficient powers might already exist but they might not be being used. What is clear is that, because of loopholes in the law, a lack of law, or a lack of action on the part of the Government, firms are being allowed to escape unpunished, despite engaging in practices that are misleading and misrepresentative. I hope that the Minister will acknowledge that.

'In addition to challenging the Government to consider legislation, I propose the setting up of an independent, self-regulating body to monitor the actions of land investment firms to ensure that they are not engaging in the kind of practices that I have mentioned. Such a move could include the establishment of an accreditation scheme to ensure that firms act responsibly and correctly. Only where organisations are found to be acting accordingly with agreed guidelines would they receive accreditation and thus be allowed to persist in investing in, and selling on, tracts of land.

Mr Mulholland concluded, 'Today, I am tabling an early-day motion, which is co-sponsored by the hon. Members for Stroud and for North-East Milton Keynes (Mr. Lancaster), which I hope many hon. Members will sign. I ask the Minister and the Government to take the issue seriously and to acknowledge that there is a problem that needs to be tackled. The situation has been allowed to persist for far too long, and urgent action is needed to stop companies, partnerships and individuals ripping off their investors and damaging our communities. I hope that the Minister and the Government will work with me, my parliamentary colleagues and the organisations involved to stop the unacceptable mis-selling of greenfield land.

libdems.org.uk/community/house-of-commons-westminster-hall-land-banking120706.html

Complete version of speech:

12 July 2006 : Column 489WH
Land Banking
4.15 pm

Greg Mulholland (Leeds, North-West) (LD): Let me start by saying what a pleasure it is to have you in the Chair, Mr. Hancock. There was a slight diary confusion in my office about the start time of the debate, and I probably broke the record for getting here from Norman Shaw South. Perhaps we can look into having a record for that run: I did it in about two and a half minutes. [Interruption.]

Mr. Mike Hancock (in the Chair): Order. Members of the public are not permitted to walk through the Chamber.

Greg Mulholland: I am very pleased to have secured the debate, and to have this opportunity to raise this increasingly important issue in the House. As I have already made clear to the Minister, I wish to focus specifically on the practice in which a number of disreputable companies and individuals around the country are engaged: the misrepresentation and mis-selling of greenfield land, which is becoming a critical issue in many rural and semi-rural areas. Before I expand on that, I want to make it clear that my purpose today is to ensure that after the debate the Minister and the Government will agree to work with me and MPs from all parties who are also concerned to address this issue. I shall make some suggestions later as to how that could be achieved.

Let me define precisely the relevant issues. In broad terms, land banking is simply the practice of purchasing undeveloped land for future developments or resale. That investment often comes in the form of land investment companies or partnerships buying land, subdividing it and then encouraging secondary investors to buy individual plots. If the land value increases, the investment companies gain a high return, and the secondary investors also benefit. In the vast majority of cases, for the value of the land to increase substantially, a "change of use" must be accorded to the land, which means that local councils must grant permission for it to be developed. If it is green belt land, there needs to be a change in status.

For those of us with rural and semi-rural land in our areas, this is a highly contentious issue. It is particularly worrying that there appear still to be individuals and partnerships buying up large areas of undeveloped green belt land and deliberately suggesting, or at least giving the impression, that permission for that land to be developed is likely-often, they give the impression that it is very likely, or a done deal-when that is far from the truth. I have an example from my own constituency which illustrates how that practice works. It is how I came across the issue in the first place.

As I stated in the House when I introduced my ten-minute Bill in November last year, a company called English Land Partnership bought and owns a piece of undeveloped greenfield land, Cookridge pastures, on the edge of an area of housing. The land is designated green belt land, and Leeds city council has categorically stated that permission for the development of Cookridge pastures is extremely unlikely to be given for the foreseeable future. Yet I have seen copies of a video and its accompanying letter and a website that give a very different impression.

I was pleased that the BBC in Yorkshire did a special report on the Cookridge pastures development on its "Inside Out" programme. I will share some of that with the Chamber to show that English Land Partnership explicitly claimed to investors, in private, that the local council would award permission for development. I shall quote an English Land Partnership employee, Paul Hudson, who was secretly filmed as part of the BBC investigation. He said:

"We would submit the application by the end of next year, within 12 months, then it would take another year, 14 months for them to say yes, so we are talking about 2, 2 and 1/2 years tops!"

He went on to say that those who invested would be getting

"one of the best deals on the market".

Just to leave no ambiguity about how ELP views Cookridge pastures, I must point out that Hudson said:

"you are going to be making 100,000, you are going to be asking me, 'where is the next project?'"

That claim is clearly outrageous given the advice that we have had from the council and the Government; it is incorrect and misleading. Companies are doing that sort of thing up and down the country. Even after the airing of "Inside Out", English Land Partnership continues to market the development potential of Cookridge pastures. Its website proclaimed that it is a wonderful "potential future development opportunity" at the heart of the "fastest growing city in Europe".

Such an approach has caused great dismay to local residents and to those who have been duped into investing in the schemes. It is not an isolated case. Since introducing my ten-minute Bill last year, I have been inundated with correspondence from people up and down the country. They told me of similar schemes, of communities worried about the effect that the practice will have on their locality, and of investors who feel that they have been ripped off.

Tim Farron (Westmorland and Lonsdale) (LD): I shall give an example from another part of the country, as I am sure my hon. Friend is about to do. It relates to a brownfield site in my constituency. The site of Sedbergh livestock auction mart, which has planning permission for that very purpose, is on the market having been temporarily closed. The excellent farmers' co-operative is hoping to buy the site but, of course, the site is on the open market. There is every chance that a company such as the one that he mentioned could purchase the site, sit on it entirely legally for years with the intent to use it for something other than what it has planning permission for, and blackmail-or rather, browbeat-the local authority to change the permission in years to come. That would cost the community its local auction mart and would be a blow to it. Does my hon. Friend agree that that example adds to his case?

Greg Mulholland: I thank my hon. Friend for another useful example. I am also working closely with the hon. Member for Stroud (Mr. Drew), who alerted me to the practices of Gladwish Land Sales Ltd in his constituency. In the past few weeks, The Observer has exposed land banking scams right across the country and is also calling for urgent action to stop innocent investors being exploited and local communities being damaged by the swindles. I am calling for the situation to be addressed by the Government.

I acknowledge that, at this stage, local councils are taking action. Indeed, the Local Government Association has urged them to make use of all existing available legislation, including article 4 notices, to respond to the schemes. However, those notices, which are one of the few weapons that councils have, only restrict the erection of posts or fences on undeveloped land. They do not restrict the sale of the land or its mis-selling, which is what I am focusing on today.

The LGA also urges councils to contact trading standards and the Department of Trade and Industry to inform them of misleading and illegal trading practices. However, there is confusion over the issue. I contacted the DTI last year and was informed that because land banking firms such as English Land Partnership are partnerships and not companies, the DTI does not have the jurisdiction to investigate the mis-selling practices of such firms.

I come to the specific proposals, for which there are precedents in other parts of the world. As the Campaign to Protect Rural England has highlighted, in Australia in December 2005 the European Land Sales Partnership stood accused of grossly misleading potential investors over its ability to obtain planning permission and the likelihood of planning permission being granted on the tracts of land that it owned. The key difference in that case was that the state government of Victoria was able to act quickly and decisively to bring a halt to the mis-selling. The state legislature obtained an interim injunction order against ELSP, which prevents it from engaging in a range of promotional and marketing activities until there has been a full hearing into its activities, which is due to take place in the Victoria Supreme Court this year. So far, no such decisive action has taken place in the UK. The only course of action for investors who feel that they have been sold land on a false premise or been the subject of misrepresentation would appear to be to pursue cases individually through the courts.

There is a strong coalition working on this matter. As I mentioned, I am working with the CPRE. I am also working with several MPs from all parts of the House, and I have been contacted by reputable land investment companies, including possibly the largest such company in the United Kingdom, UK Land Investments Group. Firms of that nature are concerned, because they invest large sums to ensure that land is bought and sold legally and without misrepresentation. They wish to see fly-by-night organisations brought to book for their scandalous practices and the damage that they do to the industry.

We may need new legislation for that to take place or we might simply need the extension or clarification of existing legislation. Sufficient powers might already exist but they might not be being used. What is clear is that, because of loopholes in the law, a lack of law, or a lack of action on the part of the Government, firms are being allowed to escape unpunished, despite engaging in practices that are misleading and misrepresentative. I hope that the Minister will acknowledge that.

In addition to challenging the Government to consider legislation, I propose the setting up of an independent, self-regulating body to monitor the actions of land investment firms to ensure that they are not engaging in the kind of practices that I have mentioned. Such a move could include the establishment of an accreditation scheme to ensure that firms act responsibly and correctly. Only where organisations are found to be acting accordingly with agreed guidelines would they receive accreditation and thus be allowed to persist in investing in, and selling on, tracts of land.

Commercialland.biz: Stephen Cleeve's new venture
(Posted 27th January 2006)

investdrinks is delighted to bring to the attention of Stephen Cleeve's many friends and  admirers of his new venture Commercial Land. In the these drab days of winter it is particularly warming to see the entrepreneurial and enterprising Stephen Cleeve embarking on a new venture, Commercial Land (commercialland.biz). Apparently due to launch soon Commercial Land will be 'looking for land that in the future may become rezoned and able to be developed commercially'. Commercial Land is based at Knights Court, 6-8 St Johns Square, London EC1M 4DE. Tel: 020 7250 1000, fax: 020 7324 1560 or info@commercialland.biz.

With Western Australia and Victoria both issuing public warnings against ELS and Stephen Cleeve, the end of last year was probably difficult and challenging for ELS and Stephen Cleeve. One has to admire Mr Cleeve's remarkable resilience - a lesser person might have been discouraged. Instead Commercial Land is already looking to transform agricultural land into C3 (light industrial) use. In mid-January a Mr Jay Saggar - some marvelous Dickensian echoes here - from Commercial Land contacted a planning expert in Cumbria on with a view to starting the lobbying process to get a change of use on land at Milnthorpe LA7 7EX. Jay Saggar wanted 'to get this piece of land into the Council's (LDF) Local Development. Our aim is to seek the best way forward for a change of use of the site for future planning consent to possible C3 use, which I understand may be acceptable to the council considering emerging policy.' The planning expert, who had previously been contacted by ELS with a view to getting residential planning permission on the same land, declined to be involved.

And yet there may be merit in Mr Saggar's proposal. After all workers in the future light industrial units at Leasgill would enjoy uninterrupted views across unspoilt countryside. It's probably a long shot but after all the Tower of London was once open land...  Of course if they could also get residential planning permission the employees could live on site.

There are doubtless lots of details that the many friends and admirers of Stephen Cleeve would like to know about Commercial Land  - when will the new venture launch, is John Beckwith-Smith, Cleeve's ELS partner also involved, what sort of track record and expertise does Stephen Cleeve and Commercial Land have in this sphere of property, will Commercial Land be promoted in Australia etc? investdrinks has emailed Stephen Cleeve some questions but sadly has yet to receive a response. Doubtless our enterprising entrepreneur is fully occupied both with his new scheme and possibly preparing for the court case before the Supreme Court in the State of Victoria due later this year. investdrinks looks forward to being able to post further news in the near future. 

Public warning from Consumer Affairs Victoria
(Posted 3rd January 2006)

The director of Consumer Affairs in the Australian State of Victoria issued a public warning against European Land Sales Partnership and Stephen Cleeve following a ruling by the Supreme Court of Victoria. Marilyn Warren, the chief justice of the Supreme Court, ordered that European Land Sales and its partners refrain from showing a promotion video about the business and from stating to potential investors that they have a "track record" or that the business or its partners are experts or have expertise in relation to the development of land. This is the now famous video where Stephen Cleeve and Jerry Smith made some rather optimistic claims about ELS’ track record. There will be a full hearing in 2006. See below for the full text of the warning.

A public warning probably wasn’t the Christmas present that our indefatigable and enterprising entrepreneur Stephen Cleeve would have chosen for himself but Australia in 2005 has not been a happy experience for Stephen Cleeve and ELS. Setbacks have included a previous public warning in Western Australia and a precipitate exit from the Perth Property Show followed by Stephen Cleeve having a starring role on A Current Affair on September 19th. It seems likely that Stephen Cleeve will be spending less time in Australia in 2006 and perhaps more in Asia-Pacific and the Gulf States of the Middle East. Rather mysteriously there appears to have been no mention in all of this of Stephen Cleeve’s distinguished but seemingly rather somnolent partner, John Beckwith-Smith.

Public Warning Notice

European Land Sales Partnership (also known as European Land Sales Australia, ELS Australia and European Land Sales) and Stephen Cleeve

Pursuant to section 162A of the Fair Trading Act 1999 the Director of Consumer Affairs Victoria has issued the following warning to the public:

The Director of Consumer Affairs warns Victorian consumers about the activities of EUROPEAN LAND SALES PARTNERSHIP, also known as EUROPEAN LAND SALES AUSTRALIA, ELS AUSTRALIA and EUROPEAN LAND SALES.

The business, operated by UK-based partner STEPHEN CLEEVE purchases tracts of rural land in England and then on-sells small plots of that land to Australian consumers. Sales are promoted on the basis that the market value of the individual plots will appreciate considerably once permission to construct housing on the land is granted. The business also claims to have a proven "track record" in securing residential planning permission.

Consumer Affairs Victoria is of the view that European Land Sales Partnership grossly misrepresents the likelihood of planning permission being granted and its experience and skill in obtaining such permission. To date, planning permission has not been granted in respect of any of the tracts of land sold or promoted by the business to Australian consumers.

In November 2005, Consumer Affairs Victoria commenced proceedings against European Land Sales Partnership in the Supreme Court of Victoria, seeking a series of injunctions that would prevent the business and its partners from engaging in misleading and deceptive conduct in connection with the sale of land to Australian consumers in breach of the Fair Trading Act 1999.

On 21 December 2005, the Chief Justice of the Supreme Court, Marilyn Warren, held that representations made by European Land Sales Partnership were arguably misleading and deceptive and that there was "a serious question to be tried". Her Honour found that the first and second defendants' conduct was arguably a risk to the public and the public interest in protecting Victorian consumers outweighed any commercial costs to the defendants. Her Honour ordered that European Land Sales and its partners refrain from showing a promotion video about the business and from stating to potential investors that they have a "track record" or that the business or its partners are experts or have expertise in relation to the development of land. The matter will be listed for a full hearing in 2006.

Victorians are warned not to buy or enter into contracts to purchase land with the business or its partners without first obtaining independent expert advice or confirmation from relevant councils or planning departments that the land will, or is likely to be, granted residential planning permission in the near future.

Anyone who has dealt with European Land Sales Australia or partner, Mr Stephen Cleeve, is encouraged to contact Consumer Affairs Victoria on 1300 55 81 81.

Australian woes assail Cleeve and ELS
(Posted 22nd November 2005)

investdrinks is considerably distressed to learn that the great entrepreneur's problems in Australia appear to be growing. In the most recent blow to Stephen Cleeve and ELS Consumer Affairs for the state of Victoria has launched a Supreme Court action applying for injunctions that would force ELS to modify its sales pitch in Australia.

According to reports in the Australian (22nd November 2005) 'barrister Jonathon Moore, for the Director of Consumer Affairs Victoria, told yesterday's hearing the company had "grossly misrepresented" the likelihood of obtaining planning permission, leaving buyers with no safeguards and exposing them to likely losses.' 'Mr Moore also accused the group of misrepresentation by claiming it had a "track record" of obtaining a change in the use of land, when in fact it had never received a single planning permission.' 'Mr Moore said ELS typically paid a fraction of the cost of land sold to investors, and claims that it had a 90 per cent success rate in obtaining planning permission was "an outright falsehood". (This claim is made by Jerry Smith in ELS' promotional DVD.)

Mark Robbins, for ELS, said the action brought by the Director of Consumer Affairs was heavy-handed and raised "pretty serious" allegations of commercial impropriety.

The full report can be found at theaustralian.news.com.au/common/story_page/0,5744,17320490%5E25658,00.html

ELS out of Melbourne and Sydney property expos

Although they had booked a stand ELS did not exhibit at the Melbourne Property Expo (7th-9th October) and the stand reserved at the Sydney Property Expo on 17th-19th March 2006 has been cancelled. It is not known whether the organizers withdrew their invitation following the action by Western Australia and Stephen Cleeve's memorable appearance on A Current Affair on Channel  Nine (19th September 2005) or whether it was ELS who cancelled the bookings. Property shows in Australia have been a significant part of Cleeve's and ELS' sales strategy in Australia.

Weedy plots

Luke Dicicco, a journalist with the Westmoreland Gazette, has recently reported that European Land Sales has said that 'it would meet the cost of the removal of ragwort, spear thistle and broad leaved dock if the Department of Environment, Fisheries and Rural Affairs (Defra) deemed action was needed at the field in Leasgill, near Heversham'. The pledge came after Heversham Parish Council identified the three weeds at the site.

The weeds are three of five named under the Weeds Act 1959 and are regarded as dangerous to livestock. The Gazette reported last month how London-based ELS had sold off around 90 plots of the field for £8,000 to investors.

Westmorland and Lonsdale MP Tim Farron has signed a private members' bill that aims to outlaw land banking. The bill is due to have its second reading in May 2006 and it calls for tougher protection against development for green belt land and the devolution of power over any development to local authorities and not the Secretary of State. Unfortunately the chances of private members' bills becoming law are generally slim, although they provide publicity for problems and may persuade governments to introduce their own legislation.

Further Press coverage

Severiin Carrell in the Independent on Sunday 23rd October 2005 wrote an article headlined Warning to investors over 'false' promises. The article can be viewed at money.independent.co.uk/property/homes/article321526.ece

'Busting The International Conman'
(Posted 26th September 2005)

investdrinks now has a transcript from A Current Affair item on broadcast on Channel Nine on 19th September and entitled 'Busting The International Conman'. The item lasted six and half minutes and during the transmission Stephen Cleeve explains that ELS hasn't had time to get planning permission for any of their land plots as the extract shows:

'Stephen Cleeve:  We haven't misled any investors...

Ben Fordham - (Reporter):  But that's not true.  You only have to look at the promotional video Stephen Cleeve uses to lure Aussie investors.  It's a straight out lie.

SC [on promotional video]:  One of the questions I get asked most is what happens if you don't get planning err this is a situation where first you have to look at our track record.  Our track record shows that we do get planning in most of our cases.

BF:  Now for the truth:  European Land Sales has no track record.  There's not one case of the company getting planning approval despite what's said on the video.

Bald headed presenter [on promotional video]:  We probably have a 90% success rate. (This is Jerry Smith-investdrinks)

BF:  What percentage of the land that you have sold has been rezoned to allow housing?

SC:  The process takes 2 - 5 years to rezone land, okay?  Therefore as the company has been in business for 15 months it would be impossible, physically impossible, for us to have rezoned anything.'

This surely establishes Steve Cleeve (and Jeremy Smith) as true and remarkable visionaries - their famous dvd speaks of the success of future plots many years into the future.

Marina Denkovic, a former employee of Stephen Cleeve's in the ELS Australia operation claims in the programme that 'The office was a shambles.'

The full transcript of A Current Affair can be accessed here.

Fordman's claim that Cleeve was 'exposed in a 60 million pound scam' needs clarification. In early 1997 the Serious Fraud Office estimated that the whisky barrel investment scams had turned over around £60 million in total. A number of companies were involved in this scam and were investigated by the SFO. One of the companies the SFO investigated was The Napier Spirit Company where Cleeve was one of the directors. Napier was closed in the public interest by the DTI in February 1997. The SFO never pressed charges against any of the directors of The Napier Spirit Company. Napier was responsible for only a part of the £60 million scam. 

Sadly investdrinks has yet to receive a reply from Steve Cleeve about ELS' future in Australia. Doubtless he has been too busy fielding offers for further starring roles in TV. However, it looks like ELS will continue to sell small plots of UK agricultural land to Australians. Land Traders (ELS) has booked stand A23 at the Melbourne Property Expo (7th-9th October). A23 appears to be a six metre long by three wide stand and is on the aisle leading from the entrance to the seminar theatre. ELS Australia are also booked in for the Sydney Property Expo on 17th-19th March 2006 where they have stand N25 - a six by three stand on an aisle leading to the seminar theatre. Assuming that ELS opts for the exhibitor's stand package the Melbourne stand will cost $AU8316 and the one in Sydney $8514. Details on propertyexpo.com.au

Presumably Steve Cleeve's and ELS appearance at these two expos is dependent on Victoria and New South Wales not issuing warnings against Cleeve and ELS similar to that issued by Western Australia on 16th September 2005.

Cleeve stars on Australia's Channel Nine
(Posted 22nd September 2005)

Claims made by ex-ELS employee Trevor Pillay (aka Clever Trevor) that Stephen Cleeve is 'very, very well known in England' and 'a bit of a household name' appear to be coming true. Only it is in Australia rather than the UK that Cleeve is fast becoming a 'household name'. Steve Cleeve had a starring role in A Current Affair, a prime time programme on Channel Nine. We hope to have further details soon.

Sadly Cleeve's latest visit to Australia does not appear to have gone as well as he might have hoped, especially as it was all looking so positive beforehand. Pole position (Stand Number One) at the Perth Money Show (16th-18th September at the Perth Convention Exhibition Centre) giving Cleeve and the ELS Australia staff a golden opportunity to interest freshly arrived punters in small plots of UK agricultural land.

All that came to a premature end when on 16th the Department of Consumer and Employment Protection of Western Australia issued a media statement warning: 'Discredited British property promoter targets WA.' The statement put out by Patrick Walker, the Consumer Protection Commissioner. It warned that 'ELS, the owner of large tracts of rural land in England, is selling small parcels of that land to individual investors with the opportunity to make significant gains following subdivision. The application for planning approval to subdivide will be made up to nine years after all the lots have been sold off. "This is a high risk and speculative investment," Mr Walker said. "This should leave no one in doubt to the grave risks of dealing with ELS and Mr Cleeve. I urge people to steer clear of these property promoters." The statement also pointed out that ELS is not registered as a business in Western Australia, which is an offence under the Business Names Act. See full statement at: docep.wa.gov.au/Corporate/Media/default.html

Before the end of the first day of the Perth Money Show Cleeve and his ELS staff were dismantling the stand and packing their bags. Furthermore according to jenman.com 'late on Friday (16th September), a senior federal regulator said that warnings about Cleeve and European Land Sales are being sent to all Australia's state consumer protection agencies'.

Regrettably some carpers might wonder why the UK authorities appear to have been considerably less proactive than the Western Australian Government. This is not the view of investdrinks -- Stephen Cleeve's remarkable dedication in attempting to flog scraps of agricultural land - with no guarantee of ever getting planning permission - around the world is one of the unsung wonders of modern day global entrepreneurship.

The enterprising Stephen Cleeve's long journey out to Australia would appear to have been to little avail. The warning issued by the Western Australian government coupled with a federal warning to the other Australian states would appear to place a considerable question mark over Cleeve's and ELS' continued participation in various expos around Australia where they have been frequent exhibitors and Cleeve has given a number of seminars extolling the manifold benefits of land banking. Indeed this and A Current Affair programme of 19th September must put ELS' Australian operation in doubt. investdrinks has emailed Steve Cleeve to find out if there is a future for ELS in Australia but no reply has been received so far.

About us - but who?

The 'About us' page on the ELS website has gradually become more minimalist. Now there is no mention of any of the partners, consultants or the partnership's solicitors. Only the claim that 'The European Land Sales Partnership and its associates have acquired a wealth of experience in the identification and acquisition of land and property' remains. investdrinks trusts that now Stephen Cleeve has become a prime time Australian TV star that he will be given due credit on the ELS website by his partners and associates.

ELS out of pocket with Pillay or 'OK Cleevie, hold onto your hat'
(Posted 5th September 2005)

Sadly investdrinks has a rather distressing tale to tell. It would seem that Trevor Pillay, formerly head of the ELS operation in Australia, helped himself to some of the land plotting company's cash. Sharp-eyed followers of ELS' fortunes may have noticed a short piece in the Secret agent column of The Age (31st July 2005). Pillay had appeared in the Melbourne magistrates court in the afternoon of 27th June 'on one charge of obtaining a financial advantage by deception and one of obtaining property by deception. He was released on bond for a year, without conviction, and ordered to pay $3334.52.' Secret agent concluded rather tartly. 'With Pillay's antics, it's no surprise that partnership's performance in Melbourne has been rather underwhelming.'

It would appear that Pillay might have been in even more trouble had ELS pressed charges over some cheques. ELS' forensic investigator dj - understood to be David Jackson, manager at ELS - believed that he had uncovered $18,391 in the company accounts not fully accounted for. On police advice, however, charges were not pressed. In an email sent by dj on 27th June to Steve Cleeve he explained that the police advised that ELS would have a very difficult job prosecuting him 'as we have no proper financial controls in place, and it is very arguable as to whether he (Pillay) was acting within his remit.' dj explained that he had had to make an immediate decision over whether to prosecute because of 'the sudden court appearance'. dj advised Cleeve that 'although we have lost our window of opportunity to prosecute criminally for the cheques' they could still bring a civil case if they wished.

It is not known how Trevor Pillay's regrettable behaviour came to light nor whether David Jackson was sent out to investigate or whether he was in Melbourne on general ELS business. He stayed in room 1248 in the Park Hyatt Hotel on Parliament Square in Melbourne. On Sunday 26th June he emailed 'Cleevie' detailing what he had found in the accounts. Jackson's findings included Pillay taking a trip to Brisbane for an Expo on 2nd June. However, there did not seem to have been an expo in Brisbane that weekend.  Expenses for Brisbane totalled $1,161.02 - flights to Brisbane and a room at the Hilton Brisbane 'the city's most convenient hotel location for interstate and overseas business and leisure visitors' (Hilton website). 'Appears to be a holiday for him and Hayley' comments Jackson. He also said he found claims for expenses that were not matched with receipts and that there were two differing versions of the accounts.

Jackson warns Cleeve. 'This is a large theft and a fraud - I'm gonna have to take it to the police.'

Jackson contacted the police and by next afternoon Pillay had appeared in a Melbourne court. As Jackson remarked 'How unbelievably quick is the justice system over here??!???'

Unfortunately the decision to appoint Trevor Pillay as head of the Australian operation appears to have been a mistake. Apart from his sticky fingers, there was his hilarious encounter with Neil Jenman in February 2005. Furthermore business was not great as Jackson reported to Cleeve. 'Finally on the business side all is not well. We appear to have very few solid deposits. I have an email from Trev telling someone that ALL deosits (sic) are refundable for as lonfg (sic) as the client wants - and clients have up to six months to settle. I'll get to the bottom of this over the next couple of days.'

Investors may well wonder why ELS failed put any 'proper financial controls in place' in their Australian operation. Cleeve's critics may say that this shows that that ELS is just a short-term get rich quick scheme and so financial controls are an unnecessary long-term luxury. But it may be that the indefatigable and entrepreneurial Steve Cleeve has been so busy travelling the world expounding the manifold benefits of buying small plots of agricultural land that there hasn't been time to set up the ELS Australian office, which opened earlier this year, properly.

Investors might also reasonably wonder whether there are 'proper financial controls in place' at the London operation. It is hard enough for newly formed companies or partnerships to survive, so failing to organise a company properly will only make it harder. It is evident that getting planning permission for agricultural land held by ELS (and other land plotting companies) will be decidedly tough . Should ELS collapse because it is incompetently managed, then the possibility of a host of owners of scraps of a larger plot getting planning permission must be virtually negligible. It should, however, be noted that the compulsory buy back option is in the name of Stephen James Cleeve and not ELS, so even if ELS does disappear Cleeve would still be a position to make a planning application.

The Irish Independent

The Irish Independent ran a story in March by Damian Corless about land banking and ELS in particular. The article can be found at jenman.com.au/NewsArticles1.php?id=154

ELS have recently changed their phone number from 020-7242 4242 to 020-7248 7800. ELS' London office is still at 77 Kingsway, WC2.

www.stephencleeve.com
(Posted 1st September 2005)

stephencleeve.com is a new site dedicated to Stephen James Cleeve. It was registered on 3rd August 2005 with DomainsByProxy.com based in Scottsdale, Arizona, USA.

An ELS salesman calls

I was intrigued to receive a call around 4.30 pm on 24th August from a salesman at ELS. He was calling in response to a request I had made through the ELS website for more information several months ago.  The salesman said a number of interesting things. He told me that ELS had retained Bell Pottinger as political lobbyists and that ELS' strategy was to lobby first before submitting planning applications any planning applications. Only then would planning applications be submitted.

Peter Bingle, managing director of Bell Pottinger, told investdrinks that Bell Pottinger had not been retained by European Land Sales as political lobbyists. The company had, however, carried out 'a one off project to audit the political and planning issues relating to one of their sites in the Milton Keynes area but this is not a lobbying project'. 'I am concerned that this does not appear to have been communicated to you in an accurate way,' Bingle added. Bingle has also told me that Bell Pottinger has told ELS that 'we do not wish to proceed with the proposed stakeholder audit'.

The salesman agreed that land plotting was a speculative investment. He mentioned that a Bill Beasley, also known as Bill Bailey, had worked for ELS before going off to be involved in another land plotting company also based in the Holborn area. John Beckwith-Smith, who works for Grosvenor Estates is a partner and Jerry Smith is a consultant "from time to time" and "helps on a daily basis".  (Smith has told previously told investdrinks that he no longer is a consultant for ELS. - see posting 8th June 2005.)

The salesman explained that the ELS transfer document includes a compulsory buy back option. This gets around the problem of what happens if ELS does one day get planning permission on a site but are unable to trace owners of the plots or some do not wish to sell. ELS will pay either the market value of the plot when it serves the option notice or three times the price paid at the time of original transfer - whichever is the largest. The option lasts for 21 years from the time of the transfer. Obviously ELS would only exercise the compulsory buy back option if it secured planning permission for the plots of land.

Having a compulsory buy-back option is probably essential to these land-plotting schemes. Clearly each small plot that investors buy will not be developed separately but will be part of the whole development should planning permission happen to be granted. Without a compulsory buy back scheme any development would be blocked if either a plot holder did not wish to sell or it was impossible to trace the owner of a plot.  In essence investors are buying shares in one single large plot.  It is arguable that land plotting schemes with a compulsory buy back option may be a collective investment.

ELS have changed their phone number from 020-7242 4242 to 020-7248 7800.

ELS properties on propertyfinder.com
(Posted 18th July 2005)

Anyone keen to see a range of land/properties offered by ELS should visit the property finder site and search on European Land Sales. Currently there are some 20 sites/properties listed mainly in southern England. Sites include Chelmsford, Witney, Norwich Dorking and Horton Kirby near Dartford, Kent. It is not known whether any have planning permission or whether ELS has submitted any applications. The ELS track record chart will be updated as information on planning applications is received.

Do The Guardian and ELS agree?

On the 18th June the Guardian carried an article Are they really as safe as houses? that looked at the investment potential of various property investment vehicles including property unit trusts, property stock market and agricultural land. Plots of agricultural land did not impress (see below).

From The Guardian (18th June 2005)
Are they really as safe as houses?

Agricultural land

These offers promise huge returns based on purchasing agricultural land that the promoters say is likely to receive planning permission for residential property development. A large field that can be bought for little more than £100,000 can soar to £2m-plus once permission is granted say the promoters. The schemes usually parcel up a couple of acres into small plots for investors putting up £5000 to £10,000 a go.

Verdict: The most speculative property investment, carrying the highest risk of failure. "This is the never-never end of investing," says Mark Dampier of HargreavesLansdown. "It could happen, but equally you could be waiting for 100 years, and maybe for ever."

Rating: No stars

From a contract drawn up in September 2004 between Stephen James Cleeve and a buyer of a plot it appears that Cleeve and ELS may be in agreement that this a decidedly speculative property investment. The front page of the contract usefully warns that 'This is a formal document, designed to create legal rights and legal obligations. Take advice before using it.' The special conditions section of the contract sets out with admirable clarity the risks involved in land plotting investments.

Clause 8: 'The property is sold without the benefit of Planning Permission for any purpose and the Seller gives no warranty that Planning Permission will be granted at any time in the future.' 

Clause 11: The Seller expressly denies liability for any statement representation or warranty made by any person or agent or employee involved in the sale of the Property unless the same are set out in writing signed by the Seller and annexed to this agreement in which event only such matters will form part of this Agreement.

Clause 14: The seller does not claim specialist knowledge or expertise as to the future prices of land and the likelihood of land being reclassified. The seller does not offer advice or speculate as to predicted land price rises. Historical rises in the value of land are not a reliable guide to the future prices of land. Whilst it is reasonable to predict that some land will be reclassified in the future, this provides no guidelines or guarantees that land sold by the seller will be of this type and no return can be guaranteed

At first sight the claim of no specialist expertise would be appear to be at some variance with the statement on the ELS website: 'The European Land Sales Partnership and its associates have acquired a wealth of experience in the identification and acquisition of land and property.'

The contract makes admirably clear that land plotting could be a very long-term shot:

Clause 12: The seller will start the planning process at a time when it is felt it will be the most advantageous time to do so although no liability is accepted by the seller for any misjudgements made. The seller will pay for one application for outline planning permission for residential use for the land now or formerly in title number ******** at its own expense. The planning process will be made no later than 9 years after the last plot has been sold but may be as early as 12 months.

Of course it is theoretically possible that for many good reasons the last plot is never sold, so an application may never need to be made.

At the end of the contract the buyer is most admirably advised to seek legal advice: 'This is a legally binding document on which the buyer is advised to take Independent legal advice.' investdrinks is in entire agreement with Stephen Cleeve and ELS here and urges anyone considering taking a punt of a plot of land through ELS or any of a number of other companies also selling this type of 'investment' to take independent legal and financial advice before making any commitment to purchase.

It is also worth considering whether dividing land up into a number of plots may not actually reduce the chances of planning permission or, if planning permission is ever given, actually being able to sell it on for a profit. It might well take only one plot holder to refuse to sell at the price offered for a sale or arrangement with a developer to fall through. Equally if an application is made nine years after the last plot has been sold will it be possible to trace all the owners of the plots?

The more plots there are on a particular site is likely to make the task of keeping track of all of owners increasingly difficult. From a land registry print (5th July 2005) parts of ELS's well-known Bow Brickhilll site appears to have been further sub-divided since a title plan of 24th September 2004. There were around 113 plots in September 2004, which had climbed to some 180 by July 2005. Doubtless the admirably enterprising Mr Cleeve has the necessary systems in place to keep up with plot-owners changes of address and circumstances. There is also the intriguing possibility that individual plot owners may decide to sub-divide their plots and then sell these on.

ELS track record chart as of 7th June 2005
(Posted 9th June 2005)

investdrinks has now contacted the relevant planning officials at all five of ELS' known sites and is pleased to present the results. I have sent a copy of the chart to Stephen Cleeve asking whether there are any ELS' sites that I have not included but have yet to receive a reply. I have also suggested to him that he may wish to provide copies of the chart to his sales team in London and Australia so that they are fully conversant with the planning status of all of the ELS sites. 

Site Planning applications made Planning applications accepted Houses built
Bow Brickhill 0 0 0
Leasgill, Cumbria 0 0 0
Mead Lane, Eynsham 0 0 0
Umberleigh, North Devon 0 0 0
Winslow Road, Granborough 0 0 0
Total 0 0 0

"One of the questions I get asked the most is what happens if you don't get planning. Er... this is a situation where you firstly have to look at our track record. Our track record shows us that we do get planning in most of our cases. Um and also if we have done our due diligence properly is something that just does not occur."
Stephen Cleeve, ELS presentational DVD March 2004

On the face of it there does appear to be a considerable discrepancy between Cleeve's confident claims in the ELS DVD presentation and the reality. 15 months on from the DVD presentation ELS has apparently yet to make any planning applications. In many cases the planning officers report that they have had little or no contact with either ELS or Stephen Cleeve.

Report on the current situation status of the sites

Leasgill, Cumbria

On 7th June investdrinks spoke to Fiona Clark, planning officer for South Lakeland District Council. The site is now covered by an Article 4 directive, issued in mid-May. The directive prevents the use of any enclosure, any alteration of any existing gates, walls and access as well as small caravans or markets. She confirmed that no application had been received from ELS/ELSP and explained that the South Lakeland plan allows only 185 houses a year to be built. Most of these would be in towns like Kendall or other key settlements. Clark said that were ELS to make a planning application on their Leasgill site it would not be granted. The site is outside the Leasgill settlement. It has a very steep slope and is in a very prominent position and any development would big impact on the area. The optimism 'we are currently very bullish about the prospects for the project' expressed in letters sent out by ELS in late February 2005 to site holders would appear to have decidedly shaky foundations

The now 33 registered plot holders, who have paid a total of £365,000 for their agricultural land, would appear likely to have to resign themselves to holding agricultural land in perpetuity. investdrinks understands that Cleeve paid £65,000 for the Leasgill site and that there were other bids in the region of £25,000 for the land. 

Mead Lane, Eynsham

On 7th June investdrinks spoke to Kim Smith, senior planning officer for West Oxfordshire District Council. She said that the planning department had had no dealings with the partnership (ELS/ELSP) and no application had been submitted. They had, however, received a number of enquiries from people who had either bought a plot or were considering doing so. Smith told investdrinks that any planning application had 'quite definitely no chance'. The site was on a flood plain, it is both beyond the Eynsham village limits and beyond the by-pass.

Here again it appears highly likely that Mead Lane plot owners will have to reconcile themselves to holding agricultural land in perpetuity.

Umberleigh, North Devon

On 7th June investdrinks spoke to Don Smith, senior planning officer for North Devon District Council. No planning application has been made by ELS/ELSP or Stephen Cleeve on the site to the west of Pool Batten, Burrington, Umberleigh. Nor has the planning department had any contact with ELS/ELSP or Stephen Cleeve. Should a planning application for residential development be received it stood "not a chance as it was contrary to the settlement policy. It was most unlikely to get approval." The site is covered by an Article 4 directive. Smith also reported that a nearby site (SS6425SW/ DN479670) promoted by Gladwish Land Sales Ltd of Horsham, West Sussex (incorporated as a limited company on 15th January 2003) was served with an Article 4 directive approved by the Government on 22.12.2004. Gladwish's website perfectplot.co.uk states that Gladwish Land Sales Ltd (GLS) was set up in 1987.

Here again it appears highly likely that ELS' Umberleigh plot owners will have to reconcile themselves to holding agricultural land in perpetuity.  

Winslow Road, Granborough

On 7th June investdrinks spoke to Andrew Birch of the Development Control Group of the Aylesbury Vale District Council. He said that no application had been received for this plot. He explained that the site was open countryside, it was not allocated for development and that it was unlikely to be released for housing. The area is currently designated for agriculture/forestry. He did not think that it was suitable for affordable housing as it was open countryside outside the village of Granborough and is crossed by a public footpath.

Bow Brickhill

The status of this plot is covered under the posting of 1st June.

Stephen Cleeve at SMART International Property Expo 2005

The well-travelled and enterprising Stephen Cleeve will be at the SMART International Property Expo 2005 in Hong Kong on 18th and 19th June. On the Sunday visitors will be able to attend Steve Cleeve's seminar between 14.00-14.45 on 'Changing the Use of Land and Maximizing Your Return, which will cover investing in land in the UK; how to make money out of the UK's housing crisis; the change in planning laws in the UK'. It may be that Cleeve's seminar will touch on possible strategies - telepathy, witchcraft, aerodynamic flying pigs, whistling in the dark etc. - for obtaining a change of land use without having to submit planning applications.

One of the highlights of the SMART International Property Expo will be 'Land investments in the UK and Europe with Rubicon Estates, ELS, Dragon Property and UK Land Investments; and much more'.

Complaint from UKLI Ltd

On 23rd May investdrinks received a complaint from Zena Rawaf, 'head of litigation in the legal department at UK Land Investments Group' about the posting on the land plotters section of the article Watch the Grass Grow written by Tony Hetherington which appeared on 2nd November 2003 in the Mail on Sunday. Ms Rawaf claimed that the article was defamatory and asked for it to be removed immediately. I asked Ms Rawaf to indicate what was defamatory in the article and when UKLI Ltd would be filing their company accounts overdue since 5th December 2004. Although I was assured by Ms Rawaf (23.5.05) that UKLI Ltd would be filing accounts tomorrow, they are still recorded as not having been filed as of 8th June. Nor has she provided any details of what was defamatory or inaccurate in the article. investdrinks understands that no complaint from Ms Rawaf or UKLI Ltd has been received by the Mail on Sunday.

Jerry (Jeremy) Smith not involved with ELS
(Posted 8th June 2005)

investdrinks has been told by Jerry Smith that he is no longer involved with ELS and that Smith had told Stephen Cleeve of his decision some time ago. However, his name and details were only removed from the ELS site around 27th May after further prompting from Smith. On 27th May Cleeve told investdrinks that Jerry Smith was still part of 'the team for success'. Clearly Mr Cleeve was mistaken. A fax sent to a potential client in New Zealand on 23rd May describing Smith as 'our senior planning consultant' was also similarly inaccurate. Further details to be added shortly.

investdrinks offers simple way to chart ELS’ track record
(Posted 1st June 2005)

Mindful that it is now six weeks since I asked Stephen Cleeve of ELS for details of the partnership’s track record, investdrinks has devised a simple chart (see below) that will indicate the current progress of each of ELS’ sites.

Extracts from a message recently sent to Stephen Cleeve of ELS

‘I’m a little surprised that nearly six weeks after I asked you about ELS’ track record, I have received no details. I can imagine that you and ELS are very busy travelling all over the world to various property exhibitions, while the sales force follows up leads. Even so I would have thought that since this is ‘the question I get asked the most’ you might have details to hand. Perhaps I can be of assistance here. I suggest we start with the Bow Brickhill site close to Milton Keynes that features on europeanlandsales.com.

Having contacted the Milton Keynes planning department, I can confirm that European Land Sales has not submitted any planning application (information correct to 26th May 2005). I’m informed that the planning department there has had virtually no contact with ELS. Of course submitting applications all takes time but I found Diane Webber of the planning department most helpful. Her direct line is 01908-252668 or Development.Plans@milton-keynes.gov.uk I would give her a call.

I’m not sure whether you are aware that Milton Keynes is in the middle of carrying out a review of future land use. I understand that development at the site at Bow Brickhill has been ruled out until at least 2011. However, the current study is considering what land might be developed from 2011. Ms Webber told me that the council is not ruling anything out. Their interim report is due out later this year with the final report due in the latter part of 2006. It appears that developments on reclassified land are, however, more likely to happen from 2016.

ELS’ track record as of 26th May 2005

“Our track record shows we do get planning permission.” Stephen Cleeve March 2004.

Site Planning applications made Planning applications accepted Houses built
Bow Brickhill 0 0 0

May I suggest that this simple chart is a clear and easy way to gauge ELS’ track record. Over the next few weeks it should be simple to add the details of ELS’ performance at your sites in Oxfordshire, Devon, the Lake District etc. Please let me know as soon as possible if there are any errors or changes to the chart.

I gather that some recent research indicates that it may be possible to obtain planning permission by telepathy, so avoiding the need to actually submit an application. I would be interested in your thoughts on this.

Absence of ‘the team for success’

Keen followers of the ELS’ website will have noticed that both Jerry Smith and ELS’s solicitors have now disappeared from the ‘about us’ page on the ELS’ website. investdrinks has been assured by Stephen Cleeve that Jerry Smith remains a consultant to ELS. Members of the ELS’ sales force have been sending out details of the most recent projects of Jerry Smith, ELS’ senior planning consultant.

Jerry Smith: recent projects

1996-2000: Earls Terrace, London
Near High Street, Kensington. Existing flats into expensive houses
Developer: Northacre

1997-98: The Bromptons, off Fulham Road, London
Developer: Northacre
Development of hospital built in 1840s + chapel into flats and houses

1997-2000: Dallington Lofts, London EC4
Developer: Berkeley Homes
Converting retail and light industrial premises into flats

1998-1999 Christchurch
Developer - Walker Payne
Conversion of a church in Richmond into flats

2002-2003 Chieveley Extension
Developer: Bellway Homes
‘Chronic lack of housing in the area lead (sic) to governmental decision to extend the village of Chieveley, near Newbury. Jerry successfully lobbied his site, which was ex-farmland, surrounded by land designated as being of outstanding natural beauty.
34 houses were built.’

2005 Sutton Scotney
Developer: Barratt Homes
Village near Winchester.
Change of use of ex-caravan park into new development of 33 houses
Planning permission granted by Winchester City Council prior to December 2004.

Only the Chieveley extension involved the reclassification of agricultural land. It appears that planning permission for Sutton Scotney was obtained during 2004 before Jerry Smith’s involvement.

Still no details from ELS
(Posted 19th May 2005)

investdrinks is still awaiting details of ELS's track record. It is now over a month since four apparently simple questions were asked. These were:

'How many applications for planning permission has ELS/(also known as ELSP/ Landtraders) made to date, to which local authorities and how many have been successful? Which are the sites where ELS/ELSP have taken a "raw piece of land" to "a built development"?

Given Stephen Cleeve's unambiguous invitation in the ELS presentation DVD to look at "our track record" and Jerry Smith's 90% success rate it seems decidedly strange that ELS and Mr Cleeve haven't leapt at the chance to spread news of their success in converting raw pieces of agricultural land into built developments.

Cynics might conclude that ELS's slow response is because they have no track record, that no raw pieces of agricultural land have been converted into built developments and that Jerry Smith should have said "we certainly have a zero success rate". investdrinks would counsel that this is over hasty - that very soon a fat dossier will arrive from ELS setting out details of their planning applications and highlighting where raw pieces of land have transmogrified into neat rows of houses.

investdrinks has been assured by Mr Cleeve (22nd April) that 'European Land Sales is a bona fide organisation' and that 'our business is a legitimate one' and a business that takes 'very seriously any allegations about misrepresentation'. Futhermore as Mr Cleeve says ELS has 'a strict ethical code and if any of its employees are found to breach our codes and rules they can be instantly dismissed'. investdrinks is sure that, despite the odd blemish - disqualified UK company director - that Mr Cleeve is in the words of Mark Anthony an 'honorable man'.  If the cynics' view is correct and ELS has absolutely no track record of turning cow pats into mortar, then surely as an honorable man Mr Cleeve would certainly first have fired Jerry Smith for his preposterous 90% claim, and then resigned himself as ELS's track record shows that they have never yet got planning permission.

Since the honorable Mr Cleeve is still running ELS and Jerry Smith remains a consultant, ELS must have some sort of track record otherwise he would do the honorable thing and close ELS. Wouldn't he? Furthermore our commendably industrious friends at Farrer & Co assured Neil Jenman on 25th October 2004 that there was 'no spin'. As solicitor's to the Royal family they surely wouldn't have written something that was demonstrably untrue?

So investdrinks looks forward to receiving a detailed response to the questions delivered in person to the offices of ELS on 14th April. ELS's response will be posted on the site and investdrinks, once again, invites Mr Cleeve and his partner, John Beckwith-Smith, to avail themselves of this opportunity to provide a counterbalance to some of perhaps less than positive press that ELS has garnered.

Dispute settled but no answers
(Posted 5th May 2005)

investdrinks is happy to report that the Australian visiting the UK (see posting 4th April 2005) has had his money refunded by ELS. Neil Jenman has also reported and commented on the resolved dispute - see jenman.com.au/NewsNews1.php?id=329

Unfortunately investdrinks has yet to receive a reply to the questions I asked about the ELS presentation DVD on 14th April. These questions were not covered by the ELS Press release of 22nd April 2005, so I'll ask again:

What precisely is ELS' track record on obtaining planning permission to date, how many planning applications has ELS made and is the  "90% success rate" as proclaimed by the highly experienced Jerry Smith accurate?

Press Release from ELS
(Posted 25th April 2005)

investdrinks has just received the following press release from ELS (dated 22.4.05):

'European Land Sales is a bona fide organisation.  We are doing what major building firms have been doing for generations, buying land that is at present outside of the planning boundaries, employing planning consultants and try to change the use of the land.  My fellow partner John Beckwith Smith has an MBA in Real Estate Finance from Colombia and works full time for a large private property company.  Our consultant Jerry Smith has many years experience in this market and has dealt with many house builders including Bryant homes, David Wilson, Redrow homes, Wimpey to name just a few.  He is well known to the relevant departments within these firms and is much respected within the building industry for his experience.

Our business is a legitimate one.

We have chosen our sites with great care and we will be making an announcement within the next two weeks regarding the appointment of a major planning consultancy and political lobbyist who are going to help us in our aims.

Two weeks ago we spent a further £300,000 on our site in Bow Brickhill Milton Keynes to further improve its chances in getting planning consent.*

As a company we take very seriously any allegations about misrepresentation.  We have therefore written to most of our clients and to date we have just had 2 complaints from several hundred clients.  A tiny proportion.  We are of course looking into those 2 cases in a bid to resolve them.

ELS has a strict ethical code and if any of its employees are found to breach our codes and rules they can be instantly dismissed we have already taken action in the past and dismissed employees and we will not hesitate to do so again in the future.

We have had several letters and phone calls from our clients happy with our service and refuting that they have been misrepresented in any way at all.  These letters may be inspected at our premises but in the interests of client confidentiality copies may not be taken.

We are fully committed to serving our clients and providing them good opportunities and we look forward to continuing to do so.'

(* This is thought to be the purchase of a house in Downs View. investdrinks.)

It is good to have clarified that John Beckwith-Smith remains a partner in ELS/Landtraders. However, investdrinks is still awaiting a reply to the other questions asked in the letter I delivered to ELS/Landtraders on 14th April - ie what precisely is ELS' track record to date and is this a "90% success rate" as proclaimed by the highly experienced Jerry Smith?

Some might wonder why ELS will be soon hiring 'a major planning consultancy and political lobbyist who are going to help us in our aims'. Some might wonder why go to the presumably substantial expense of a planning consultancy and a political lobbyist, on top of buying a house for £300,000, if "Our track record shows us that we do get planning in most of our cases" (Stephen Cleeve) and "we probably have a 90% success rate" (Jerry Smith). investdrinks, however, assumes that ELS is going the extra kilometre, irrespective of the expense involved to ensure, a 'win-win situation' for everyone - moving from "probably a 90% success rate" to 100%.

ELS presentation - worthy of an award
(Posted 19th April 2005)

investdrinks was delighted to receive recently a copy of ELS' film presentation made in March 2004 that was sent out to potential land plot investors. Parts of the film were shot in the fourth floor offices at 77 Kingsway of ELS or Landtraders as they are known there. It has been a treat to watch two partners - the enterprising Stephen Cleeve and the tousle haired John Beckwith-Smith - along with Jerry Smith, the Executive Property Consultant to ELS. The highlight of the presentation is Cleeve's and Smith's response to the question - what happens if you don't get planning permission.

"One of the questions I get asked the most is what happens if you don't get planning. Er... this is a situation where you firstly have to look at our track record. Our track record shows us that we do get planning in most of our cases. Um, and also if we have done our due diligence properly is something that just does not occur. But in the unlikely situation that it didn't happen etc."
Stephen Cleeve, Final ELS.mpg March 2004

"On acquiring a site we're generally pretty successful in terms of converting a raw piece of land into a built development. I would say from buying a piece of land to seeing it through to development we probably have a 90% success rate."
Jerry Smith, Final ELS.mpg March 2004

This is a truly marvelous example of how far sighted Stephen Cleeve and Jerry Smith are. In the rather tedious present investdrinks understands that none of the ELS sites has yet been granted planning permission. Nor is it clear whether ELS or Landtraders have made any  applications to change the planning status of their sites. Doubtless when Cleeve in a bravura performance speaks of "our track record" and Smith of "a 90% success rate" - 'probably' being the crucial word here, they are referring to a time when the gilded spires of ELS developments have risen over Milton Keynes and Noah's Crescent in the Oxfordshire floodplain is complete
(PS Stephen don't you think you should have edited out the Er....)

On 14th April investdrinks delivered some questions (see below) for Stephen Cleeve to the offices at 77 Kingsway.

Questions to Stephen Cleeve:

'How many applications for planning permission has ELS/(also known as ELSP/ Landtraders) made to date, to which local authorities and how many have been successful? Which are the sites where ELS/ELSP have taken a "raw piece of land" to "a built development"?

Who are the partners in European Land Sales Partnership? Is John Beckwith-Smith still a partner?' 

I might also have asked Stephen Cleeve whether Farrer & Co were shown this ELS presentation before they wrote - There is no "spin"(25th October 2004).

To date I have received no reply and assume that I will have to await the enterprising Mr Cleeve's return from the Sydney Property Expo at the Sydney Convention & Exhibition Centre where on Saturday 16th he was sporting a rather natty blue checked shirt, purplish tie and dark jacket with bold white stripes - touch of Al Capone perhaps? investdrinks will, of course, post any response received from Stephen Cleeve and ELS/Landtraders.  

Towards the end of the ELS presentation (at 10 minutes in) a map of Leatherhead Common is featured. investdrinks understands that ELS did offer investors plots here. However, unlike other sites offered by ELS, this land is apparently not owned by Stephen Cleeve. investdrinks understands that this land has long been owned by Search Investments (Jersey) Ltd, c/o 60/61 Quarry Street, Guildford, Surrey. 

A recent letter (see below) from A Gardner, senior planning officer for the Mole Valley District Council suggests that this site may not be one Smith's 90% and a nit-picker might suggest that ELS' due diligence wasn't perhaps entirely up to scratch here.

21st February 2005

Dear Sirs

Land adjoining Leatherhead Common, Oxshott Road, Leatherhead

Thank you for your letter dated 18 February concerning the above site.

The land in question lies in the Metropolitan Green belt and is also covered by a blanket Tree Preservation Order. In April of last year, an Article 4 Direction was made on the land removing permitted development rights to erect fencing and gates. Finally, the site adjoins an Area of Nature Conservation Importance.

In summary, there are a number of planning constraints upon this site. As a consequence, any application for development of any part of the land is unlikely to receive favourable consideration.

More Press coverage for ELS
(Posted April 12th 2005)

European Land Sales Partnership continues to garner an enviable amount of Press coverage from around the world. Two articles have recently appeared on quamnet.com written Cathy Holcombe, one of their columnists, following an evening listening to the ELS pitch in Mandarin Oriental in Hong Kong.  Here are a couple of extracts to give a flavour. The full texts can be accessed at:
quamnet.com/fcgi-bin/columnists.fpl?par2=5&par3=3&par4=12&par5=04&par6=2005

'Cathy Holcombe is a long-time financial journalist who was fortunate enough to be trained in financial modeling during the 1996 market bubble in Hong Kong, when even a donkey could have been hired to flog stocks. She hopes to combine these skill sets at Quam, where her unofficial title is "muckraking modeler".'

Deal Of The Century: Swampland In Buckingham
Date: 22nd March 2005

'I saw an advertisement last week for an investment opportunity of a lifetime -- buying swatches of land in the British countryside that currently houses only the occasional cow pad, but may in time hold residential developments. I went along to the Mandarin Oriental that night to find out more. We potential investors were told that if the land becomes a future development site, then its value could jump from 300% to 1,000% or more.

This is called land-banking and our presenter told us that Bob Hope made more money doing this than being a comedian. Apparently every town he played out he bought up local land in the outskirts.

Even if we were to believe that story, we would still know that Mr Hope did not buy the land from our hosts this evening, a relatively young British outfit called European Land Sales (ELS).

You see while ELS warns that investors may have to wait up to ten years (or forever) to see returns on their money, ELS get their money up front. That is because they search out potential plots, buy up the land, and then resell to small investors in small, relatively inexpensive parcels. On the bright side, they claim they retain from 24% to 49% of the holdings themselves, which means they have the incentive to pick sites with higher potential. But since they do not tell us what their mark-up is ("we just don't know? the salesman claimed with a straight face), we don't really know how great that incentive is.

Do the math. If they buy a parcel of land and sell 75% of that with a markup of 50%: they make a 12.5% return on their investment AND STILL HAVE THAT 25% STAKE to gamble with. If they double the price they paid before selling it on, their pre-expenses profit is 50% -- even while hanging onto a quarter of the land. What a great business! They have created a risk-free way to speculate on property.'

Apr 12, 2005
Swampland In Buckingham Ii: Thank God For The Internet

'ELS is obviously struggling in England amid the negative publicity. So earlier this year the group set up sales offices in Australia. But this is the age of the Internet, so the reputation of Mr Cleeve, who is banned from being a director in England until 2008 due to his involvement in one of the whisky scams, preceded him.

An Australian who runs an ethics in real estate website, Neil Jenman (jenman.com.au) went under cover to the ELS office, apparently posing as a really dumb investor, because he was told Mr Cleeve had 'connections to the royal family?and that is why ELS is able to pinpoint which lands would be approved for development.

Not long afterwards a story appeared in the Sunday Age, headlined 'British scammers set sights on Australia?

 With negative publicity in Australia, it is no wonder that ELS decided to give Hong Kong a go. The firm is also coming back in early October as part of a global property exposition at the Hong Kong Conference and Exhibition Center.

Getting venues at international trade fairs, or booking rooms in fancy hotels like the Mandarin, make such businesses appear more legitimate. But thanks to the Internet, and the easy movement of information, it is harder for confidence men to remake themselves in distant lands.

The difficulties of getting good staff?
(Posted 4th April 2004)

The following item from jenman.com suggests that the enterprising Stephen Cleeve may be having problems recruiting fully reliable staff. Either the visiting Australian misheard what was said about the Milton Keynes’ site or an over-enthusiastic ELS’s salesman may have exaggerated the position in order to close the deal.

CAUGHT ON HOLIDAY
Watch out for ELS in the UK

'I have just come back from the UK as part of a ‘round the world family trip. That should sound like happy news, but unfortunately in the UK I got sucked in to place a 10% deposit on a number of ELS plots. (European Land Sales)

After following up on research, I have decided not to proceed. I have informed ELS about my decision bearing in mind that the salesperson I dealt with assured me that my deposit is only retained if I proceed.

I was also told a lie about the status of the Milton Keynes project -the salespeople said they were in the final stages of having the place rezoned residential - that it was imminent. They said this would happen in a few weeks and proceeded to convince me to buy another project they said was adjacent to the "soon-to-be-rezoned" Milton Keynes (which they believed had equal chances of being re-zoned.)

Now their solicitor (a very rude and dismissive sort of a guy) points out to me that the moment I signed on my credit card I forfeited my right to the deposit. He says their contract says so!! -in spite of assurances I received from the sales people!!

I have been trying to contact ELS in the UK and in Melbourne but it does not look like I am going to get anywhere.

I thought I should submit this aspect of dealings by ELS for public scrutiny.

I am not giving up my hard earned cash without a fight. I would welcome any assistance or direction you can give.'

***************

There seems to be a vast difference between what ELS says in writing and what some of their salespeople say. They are a dodgy outfit, that’s for sure. It is a real worry that they are starting to target Australians for their UK land deals.

The man behind ELS, Stephen Cleeve, has been banned from being a director of any company in England until 2008.’

Cleeve buys house at Bow Brickhill

investdrinks understands from a disgruntled ELS client from Australia that Stephen Cleeve has recently brought a house in Bow Brickhill. Apparently the house was bought at an ‘overvalued £300,000’ and according to an ELS salesman ‘sits on the edge of the field’ and that ‘the reason that he has done this is so that we have all the access points into the site making our application a little easier.’

Stephen Cleeve and European & UK Land Sales at the Ideal Home Exhibition
(Posted 1st March 2005)

investdrinks is sure that Stephen Cleeve's many friends and admirers will be delighted to learn that European & UK Land Sales have a stand (see below) at the Daily Mail Ideal Home Show (idealhomeshow.co.uk) that opens at London's Earls Court on 3rd March and runs through to 28th March. It is a tribute to the Ideal Home Show organizers that they have not allowed any of the recent unfortunate publicity concerning Stephen Cleeve and the selling of small plots of agricultural land from welcoming them as exhibitors at this long established show. Indeed it is a stroke of genius for on the best evidence available Mr Cleeve's plots of agricultural land are highly likely to remain ever thus or at least for a long way into the future. These plots will remain an 'ideal home' - purchasers may never taste the all too frequent disappointment that reality brings.

Exhibitor List
European & UK Land Sales
Stand: 2B48

European Land Sales are a specialist Land Banking Organisation providing advice and management services, allowing private investors the opportunity to speculate within and profit from, investments in agricultural and forestry land, prior to obtaining planning permission

 4th Floor,
 77 Kingsway
 London
 WC2B 6SR
 Phone: 0207 242 4242
 Fax: 0207 404 0949
info@europeanlandsales.com
europeanlandsales.com

investdrinks is not sure what is meant by 'Land Banking'. It can't mean that all plots are on a slope since the Oxford site is in a flood plain.

A desert mirage

News has reached investdrinks that one of Mr Cleeve's clients in Bahrain is unhappy and 'very dismayed'. 'I can confirm that I was personally told that Planning permission for the Umberleigh site was in fact already in place for low density housing but the scheme was to be fast-tracked to obtain high density housing planning permission within two years.

'In addition to this the current values of land without planning permission were quoted as GBP100,000 per acre for Umberleigh and GBP400,000 for the site at Bow Brickhill, Milton Keynes. (The 3.5 hectare plot was bought by Stephen James Cleeve on 18th March 2004 for a stated price of £90,000.)'

investdrinks is supremely confident that the dismayed investor was told no such thing. After all Farrer & Co, solicitors to Stephen Cleeve and the Royal family wrote on 25th October 2004 that 'There is no "spin" and our clients do not say that land "will" be zoned for home buildings.' investdrinks fears that the desert has been up to its tricks again - mirages have long deluded the unwary.

European Land Sales Australia: some unfortunate publicity

The encounter (see 14.2.05) between Trevor Pillay, head of European Land Sales Partners's new office in Melbourne, and Neil Jenman has garnered some decidedly unfortunate publicity for Stephen Cleeve and ELSP/ELS. On 17th February Neil Jenman posted a piece called A QUEEN, A PRESIDENT & A SPRUIKER, An inside look at ELS and its boss, Mr Stephen Cleeve. (jenman.com.au)

The following day Jenman was interviewed by Stephen Rhodes' Consumer Program on BBC Three Counties Radio. Then on Sunday 20th February The Sunday Age ran news article by Gary LaPersonne called British scammers set sights on Australia. (theage.com.au/news/National/British-scammers-set-sights-on-Australia/2005/02/19/1108709484693.html). It remains to be seen whether The Sunday Age will receive any letters from Farrer & Co complaining about the use of the word 'scam'. With this sort of coverage can an invitation to join 'I'm a celebrity get me out of this plot' be far away?

According to The Sunday Age the ELS operation in Australia is called European Land Sales Australia and started their telesales operation on 31st January from The Exchange Tower Business Centre, 530 Little Collins Street, Melbourne. investdrinks understands that although John Beckwith-Smith's name no longer appears on the English Land Sales Partnership website his photo graces the brochures sent out to potential Australian investors who might be interested in purchasing tiny plots of agricultural land in England. Once again Stephen Cleeve's partners appear to be refusing to have his rightful share of the limelight - Cleeve doesn't rate a mention in the brochure. Surely a little odd for someone who is apparently 'a very high profile guy', is 'very, very well known in England' and is 'a bit of a household name'. 

Some highlights of the encounter in ELSA office in Melbourne between Trevor Pillay, Neil Jenman and Warren McGhee.

Trevor Pillay:  'we go away a lot, we do investment strategies. Steve Cleeve, he's a very high profile guy, he is very very well known in England.  He's a bit of a household name, he does a lot of investment. He does these big expos, he goes, he does shows.. these sort of people. It's pretty good.'

Neil J:   Does he come in here that fellow Steve?  Isn't he friends with the Prime Minister of Sri Lanka.

Pillay: The President of Sri Lanka

NJ: Oh the President.

Pillay:   Yeah.

Warren: The other thing you were telling me, is that this fellow, what's his name? Was it Steve was it?  He sort of is really well connected to the Royal family?

Pillay: Yeah, I mean, John Beckwith-Smith, on the back of the brochure, .. large sort of family,.. John actually is related to the Duke of Westminster. He is sort of his right hand man planning.

NJ: So that is how you can get to know which is going to be re-  what do you call it, re-zoned?

Pillay: Yeah, actually.we know what areas are coming up. We have a plot in Devon.  Devon is quite a eh a ..

NJ: It wouldn't be more than five years?

Pillay: No, well we doubt it. The reason we bought it is we knew Westminster. That Devon there is a new sub-station.local. what they are there to do is regenerate the area, at the moment, the house prices is really high, and the average income is really low, and people can't afford to buy houses there, they haven't got the income to house ratio is so big, so they need to build affordable housing, what you find is that a lot of the young people are moving into London and moving out of the area, which is good.. the area the tourism everything is going down.

Pillay: We keep normally about 54 per cent of it.we keep that we keep a certain amount of the plots along with all the access road, you then own the plot freehold.  You then apply for plan, which at the moment, this is worth four hundred thousand pounds an acre around a million dollars.  With planning permission it would be worth five million pounds.  So a 20,000 pound investment will return around 70,000 . And you are looking at sort of around a three to five year.

NJ: 20,000 investment would return 70,000?

Pillay: You are looking sort of three to five year period.  I mean to be honest if you get it in two years, you owe us a drink.  If we got it in three

The full transcript of the encounter between Trevor Pillay and Neil Jenman can be accessed here. investdrinks is unable to confirm rumours that Trevor Pillay is now be dubbed Trevor Pillock by the London office.

Stephen Cleeve and European Land Sales Partnership opens an office in Melbourne
(Posted 14th February 2005)

Following Stephen Cleeve's frequent trips to Australia to sell plots of agricultural land in the UK, European Land Sales Partnership (ELSP) has recently set up an office in Melbourne. The choice of the more conservative Melbourne instead of the more dynamic, vibrant and speculative Sydney doubtless reflects Cleeve's awareness of the nuances of Australia.

Although the enterprising Mr Cleeve has not yet achieved full recognition and due honour in his home country, his efforts in Australia have not gone unnoticed. Soon after Cleeve's new Melbourne office opened, investigative author Neil Jenman travelled from Sydney to pay a visit. Jenman outlines what happened:

'Yesterday afternoon (Friday - 10th February), having located his office in Melbourne, I went there with a colleague and sat down with a fellow called Trevor Pillay. There were five other men in a small room, all of whom had computer screens in front of them and were working the phones.

Pillay, believing at first that my companion and I were potential investors, made some astonishing statements. Among other things he claimed that the ELS land sites would be granted planning permission in two to three years time (five at the most). He claimed his bosses (especially John Beckwith-Smith) were connected to the British Royal Family and therefore they were privy to inside information. He also claimed that Stephen Cleeve was a good friend of the President of Sri Lanka where ELS has acquired some land.

Not long after we arrived, I realised we were on borrowed time as one of the salesmen was staring at me intently. The salesman turned his back and made a call. The phone rang in the reception area and the next minute Pillay got up and went to see the receptionist.

He then came back and was visibly trembling. He said, "Guys, lets go downstairs for a coffee."

As we stood up and made our way to the outside foyer, I pulled out my digital camera. Pillay and his cronies ran back into their office and closed the doors. I got two or three good shots.'

This Melbourne incident is most unfortunate, embarrassing and illustrates graphically the difficulty these days of finding fully reliable staff. investdrinks can only assume that Trevor Pillay, doubtless keen to do his best, rather exceeded his brief. investdrinks is confident that if all of ELSP's sales people were of the calibre and long experience of the Goldman Williams/City Vintners graduates David Jackson, Danny Nuttall and Paul Regan, now in the London office of ELSP, this embarrassment wouldn't have arisen. 

Since Neil Jenman recorded the conversation in the Melbourne office, investdrinks has to presume that the above is an accurate account of the encounter in the Melbourne. Doubtless Stephen Cleeve assured the distinguished London solicitors, Farrer & Co whose clients include the Royal family, that there was no spin given on the status of the plots of agricultural land before they wrote to Neil Jenman on 25th October 2004: 'There is no "spin" and our clients do not say that land "will" be zoned for home buildings. Their promotion materials state clearly to investors that planning permission cannot be guaranteed.'

One should not been too hard on Mr Pillay. It cannot be easy to persuade Australians to buy small plots of agricultural land of less than an acre in a country on the other side of the world, when they have plenty of land of their own.

Still no recognition for Stephen Cleeve
(Posted 7th February 2005)

Despite the best efforts of investdrinks the enterprising and indefatigable Stephen Cleeve still has not received the recognition he must richly deserve on the English Land Sales Partnership site. This despite buying up agricultural land in various parts of England and flying frequently to Australia and attending property shows in the Middle East. How galling for Mr Cleeve it must be that despite all this work there is not even the faintest bat squeak about him on the site. investdrinks can only assume that ELSPs partners and associates are unwilling to allow Mr Cleeve to feature on the site.

So who are these partners and associates? 'Jerry smith: consultant' is the only person named on the europeanlandsales.com site. He is described  'a Director of Parkhall Estates Limited, with over 20 years experience working in many sectors of the UK property industry. Parkhall is a firm of development consultants, established in 1994, to identify and acquire land and other opportunities for development. Parkhall Estates have been involved in many transactions throughout the UK and have acted for many of the countries leading house builders including Bellway, Barrett Homes, Wimpey, David Wilson Homes, Redrow Homes, Berkley Homes. Jeremy attributes the success of his company to "Having the skills in unlocking residential value on sites and knowing how to play a strategic planning game."'

Companies House' records show that Parkhall Estates Ltd was formed in June 2002. It may well be that Parkhall was a sole trader or partnership, which became a limited company in 2002. The company's registered office is 29-31 Battersea Bridge Road, London SW11 3BA. Jerry Smith and Grahame Keating are the two directors and the company is currently listed as being dormant. Smith is also the sole director of Parkhall Estates (Management) Ltd of 31-35 Clarendon Road, Watford WD17 1JF. This company was founded on 27th January 1995. The accounts to 31st December 2002 show that the company turned over £408,749 with a gross profit of £137,111 and an operating profit of £6,625. Unfortunately the next set of accounts has been overdue since 31st October 2004.

New agricultural plots for ELSP
(Posted 3rd February 2005)

February and Stephen Cleeve's trip to the Middle East is now upon us. investdrinks understands that the enterprising Mr Cleeve may well have more plots of agricultural land to offer to visitors to the European Land Sales stand at  Kuwait and Dubai. The UK Land Registry shows two further land purchases by Stephen Cleeve of Stadium Street, London SW10 0PU.

On 21st October 2004 freehold land bought for £30,000 was registered. The land is to the west of Pool Batten, Burrington, Umberleigh, North Devon. investdrinks understands that ELSP are selling plots for £4,000. Apparently the agricultural land has been divided into 230 plots that would provide a turnover of £920,000 if all the plots were sold.

A letter sent by David Smith, planning manager for the North Devon District Council, on 25th January 2005 sets out the status of this land:

'LAND TO THE WEST OF POOL BATTEN, BURRINGTON, UMBERLEIGH

The land that you have identified does not have any planning permission for housing nor has any planning application been submitted for housing. The land is in open countryside and any residential use, unless considered essential for agricultural purposes, would be contrary to national and local planning policies.'

On 4th November 2004 freehold land bought for £63,000 on 19th October was registered. The land (understood to be 2.5 acres) is on the west side of Plane Tree Cottage, Leasgill, Milnthorpe LA7 7EX.. investdrinks understands that ELSP are selling plots for £8,000.

A letter sent by Fiona Clark, planning officer for the South Lakeland District  Council, on 26th January 2005 sets out the status of this land:

'LAND ON WEST OF PLANE TREE COTTAGE, LEASGILL

The site is outside the Settlement Development Boundary for Leasgill as defined by the South Lakeland Local Plan. Policy H6 states that outside such boundaries new residential development will not be permitted. Exceptions will only be considered where the proposal is essential for agricultural or forestry workers or affordable housing to meet an identified local need. However, I would have concerns with regard to the impact development on this site would have on the character and appearance of the Area of County Landscape Importance, even when justified as an exception. I am therefore of the opinion that planning permission is unlikely to be granted for development of the site.

You should note that the above comments are an informal officer opinion, therefore not binding on the Council should an application be made.' 

Sri Lankan setback for ELSP?
(Posted 11th January 2005)

The terrible events in the Indian Ocean may well have made in it more difficult for ELSP's sales force to interest clients in buying plots of land in Sri Lanka to build beach houses.

No NY honours for Cleeve - petition for recognition

investdrinks is appalled that Stephen Cleeve's admirable enterprise and initiative in attempting to sell UK agricultural land (with no guarantee of planning permission) all over the world was not recognised in this year's New Year's Honours List. investdrinks can only surmise that Mr Cleeve's continued modesty is an important factor. There is still no mention of the land plotter tycoon on the ELSP web site. This will need to be rectified if Stephen Cleeve is to obtain the recognition he richly deserves, so now is the time for action.

investdrinks today launches an appeal to persuade Cleeve's partners in ELSP to allow Stephen Cleeve to feature on the partnership's web site. (If you would like to be included on the petition for recognition (see below) to be sent to English Land Sales Partnership please email me at investdrinks.

We, the undersigned, demand that Stephen James Cleeve, a partner in English Land Sales Partnership, is given due recognition on the Partnership's web site. (europeanlandsales.com). His disqualification as a UK company director until February 2008 should not debar him from featuring prominently on the site.

Changes at European Land Sales Partnership / an ancient spell
(posted 17th December 2004)

Appears from a very recent change to the ELSP web site. that John Beckwith-Smith may no longer be involved in the partnership. Certainly he is no longer listed as a member of 'A Team for Success' Consultant Jerry smith, a director of Parkhall Estates Ltd, is now the only member of the team listed - incidentally investdrinks is intrigued by the use of the lower case for Jerry's surname. But there is still no mention of Stephen Cleeve. Despite risking DVT by flying all over the world to sell bits of farmland, he rates not a mention on the site. This surely cannot be the right way to treat such an enterprising fellow. Doubtless Mr smith has many excellent qualities but one person does not normally constitute a team. investdrinks is giving serious consideration to getting up a petition to get Stephen Cleeve a proper mention on the ELSP site.

The partnership has also recently changed their solicitors. Nick Attwell of Coates Broughton Attwell, CBA - Law, Beacon House, Landmark Buisness (sic) Park, Whitehouse Road, Ipswitch IP1 5PB Telephone: 01473-464444 are now ELSP's solicitors.

investdrinks is also intrigued that ELSP's new solicitors are based in 'Ipswitch' and can only assume that the origins of the name come from the little village of Ips and its famously efficient witch. investdrinks is assured that this goodly creature, who disappeared late in the 18th century, had a deep fund of spells for all eventualities and has been fortunate enough to come across of fragment of a spell designed to turn farmland instantly into a spanking new housing estate.

'Stand in the middle of a land plot. Face north. Into a large black cast iron pot throw in two eyes of newts, three toads, half a dozen nips of Glenrothes malt whisky taken from an 'investment' hogshead, two and half litres of Vintage Character Port taken from an 'investment' pipe, three Chelsea FC season tickets, a Brisbane Property Expo catalogue and five yellow daisies picked from the centre of the plot.' Unfortunately the fragment breaks off here but the ingredients appear to be complete. investdrinks assumes that the good witch would stir all this up rigorously with her broomstick but whether she applied fire to the pot has sadly been lost in the mists of time. The fragment does warn that the spell is very efficacious and that once complete a smart new estate will appear within a few minutes where previously there was only grass and cowpats. Clearly there must a danger of anyone trying the spell may end up being encased in concrete.

A travellin' man
(Posted 3rd December 2004)

The indefatigable Stephen Cleeve continues to travel to sell plots of agricultural land. On the 1st and 2nd February he will be in Kuwait on the European Land Sales stand (No 49) at the debut of the International Property Expo at the Marriott Courtyard on the 1st & 2nd of February. The Expo then moves to Dubai on the 4th to 6th of February 05 and will be held at the recently opened spectacular Madinat Jumeirah Hotel & Resort. ELS' stand will be No 30.

Their catalogue entry gives a taster:

'European Land Sales specializes in sourcing land in the UK and abroad for investment purposes. Currently European Land Sales are offering dynamic investment opportunities in Milton Keynes and Devon in the UK, where land is now selling at premium rates due to the demand for new house building. European Land Sales is also offering beachfront land in Sri Lanka, which comes with planning permission and the option of designing your own dream holiday home.'

Contact person: Stephen Cleeve
Address: Fourth Floor, 77 Kingsway, London WC2B 6ST
Tel: +44 207 242 4242
Fax: +44 207 404 0949
E-mail: info@europeanlandsales.com
Web site: europeanlandsales.com

Another Neil Jenman article on European Land Sales was published on 1st December. jenman.com/NewsNews1.php?id=312

ELSP: Road access from two sides

investdrinks' attention has been drawn to a flyer sent out by everyinvestor.co.uk bringing European Land Sales partnership to the attention of their doubtless grateful subscribers. The headline ITS ABOUT TIME THE GOVERNMENT GAVE INVESTORS SOMETHING TO SMILE ABOUT grabs attention. 'John Prescott's department has relaxed planning policy, allowing speculators and developers alike a unique investment opportunity. To find out how you too could profit' is further food for thought. The flyer promotes the Bow Brickhill site near Milton Keynes as the 'latest land opportunity'. The site has road access from two sides is one of the advantages given.

A cursory glance at bowbrickhill.com/landdevelopment1.html indicates that this may be somewhat optimistic. There is no vehicular access from one side and only tractors or other farm vehicles may use the other entrance. investdrinks, is supremely confident, however, that it was not ELSP's intention to mislead here. After all there are two roads that lead towards the site. Should houses ever be built on the site, residents will just have to complete their journey on foot, which ties in perfectly with Government policy on reducing obesity through exercise. Equally the picture of a couple standing by the outline of house in a green field is not intended to suggest that house building is possible here. Rather a little local knowledge is required: for in Buckinghamshire a building outline in a field indicates to a flying pig that it is safe to land here. Clearly the happy couple are hoping that an airborne pig will make their day and land just in front of their noses.

investdrinks is pleased to be able to reprint an article by Tony Hetherington that was published last year in the Mail on Sunday about another Land Plotter company - UKLI Ltd, whose web site is: uklandinvestments.com

Watch the grass grow

2 November 2003, Mail on Sunday

Ms J. W. writes:
During a visit to an exhibition, we came across the UK Land Investments Group, which offers plots in Chesham, Buckinghamshire.

The sales pitch was that, though there is no planning permission, they feel sure that if they approach the council on behalf of 100 or so landowners, they will get it. They seem to have lost sight of the fact that if the 21,000 residents of Chesham oppose them, they are outnumbered. I am deeply suspicious.

YOU are right to be suspicious. There are more questions than answers about UK Land Investments Group and more spin than substance. For a start, the company's real name is the slightly less impressive UKLI Limited, and it is just eight months old, which means it has not yet been required to file any accounts at Companies House.

UKLI claims to have 'a rare level of expertise' in land deals and is offering investment plots in a field off Pednor Road in Chesham. But while agricultural land in this area costs a few thousand pounds an acre, UKLI is offering house-size plots of a fraction of an acre at up to £14,500 each, despite the fact that this is Green Belt land with no local authority planning approval for housing.

The company's handouts claim that these plots are 'a solid investment' that investors can 'sell on at a profit'.

But if you turn UKLI's glossy brochure on its side and use a magnifying glass on the tiny print along the edge, you find a sweeping disclaimer saying the company washes its hands of all the claims it makes and admits there is no guarantee that planning permission will ever be granted.

In fact, Chiltern District Council virtually guarantees that this field will never have planning consent for any building work. Council leader Don Phillips says UKLI and a few similar firms are a nuisance in the area.

He told me: 'These so-called investment firms rely heavily on greedy and gullible people who swallow the marketing hype and are simply looking to make a profit on their purchase. I'm afraid they will be disappointed in the Chiltern district.

'These companies buy a tract of land from a farmer, mark it up into individual plots, sometimes even putting up small fences to demarcate boundaries, and then advertise them for sale.

'The sales literature makes much of the need for housing in the area, but there is no way such land will receive planning permission for residential development.'

Chiltern District Council has served an order on UKLI, which means that the land in Pednor Road cannot be fenced off in plots and owners cannot even park a caravan on it.

UKLI's investors will find they have bought a dud.

I tried to discuss this with UKLI. It claims to have a 'highly experienced team of property professionals' at its smart Mayfair offices in London, yet attempts to speak to any of them drew a blank. They were all busy on the phone, according to a receptionist. And the company's sole director, 28-yearold Bally Chohan, was also unavailable, despite repeated invitations for him to comment.

This is odd, because Chohan's normal job is in public relations. He was certainly less shy earlier this year when he helped launch Mecca-Cola, a pro-Islam soft drink whose owner said was aimed at combating 'American imperialism and Zionism'.

Unless and until Chohan and his company come up with iron-clad guarantees, all his investors are likely to get for their money is some very expensive grass.

A response from nick@ukli.com to Tony Hetherington's article can be found at sapling.org.uk/productsforum/postings/1598.shtml

Incidentally the web site for Charles Andersen Group mentioned in the response produced this message: 'The specified server could not be found'. As of 4th December Google appears to have no further information on the Charles Andersen Group 'an advertising company which deals with the most prominent financial institutions in the UK'.

European Land Sales Partnership: Royal solicitors write again
(Posted 8th November 2004)

Our commendably industrious friends at Farrer & Co have been writing letters on behalf of Stephen Cleeve again - this time to Neil Jenman in Australia. In a letter penned on 25th October they have complained about Jenman's article on European Land Sales Partnership on jenman.com.au Farrer allege that Jenman has defamed and libelled both Stephen Cleeve and ELSP in suggesting that their business is a 'scam'. 'Defamatory and untrue' the letter says.

Farrer's letter helpfully points out that the realistic chances of the agricultural land being offered for sale by ELSP attaining planning consent in the foreseeable future is slim indeed. 

'Our clients are not in any way involved in any unlawful, unethical or "shady" business practice. All investors are fully aware that the land sold does not have planning consent neither is that planning consent guaranteed for the future.  There is no "spin" and our clients do not say that land "will" be zoned for home buildings.  Their promotion materials state clearly to investors that planning permission cannot be guaranteed.'

It is all the more commendable and remarkable that Stephen Cleeve is prepared to spend his valuable time making frequent visits to Australia to sell small plots of agricultural land. Clearly if ELSP's clients have deluded themselves into buying a virtually worthless piece of agricultural it is not ELSP's fault.

It is possible that Danny Nuttall, ex-senior broker with claret scam company Goldman Williams and now a senior consultant at European Land Sales, was making a similar point when he spoke to Jeaman on 12th October.

"If you understand what we do, land banking is all about buying land in advance of development, and getting on board, and getting it before it gets planning permission, so until it gets planning permission, nobody will know how we do, but all we have is historical precedence.  So for example, we have some land in Milton Keynes, in the UK, all we can say is our land with its hope value is positioned at 100,000 pounds per acre, once it gets planning permission we know that land in the Milton Keynes area has sold for a million and a half pounds an acre.  So you do your sums from there, but obviously you can't forecast and you can't project, because we don't know.  We just don't know is the answer.  But obviously you know what you are buying into, you are buying into the intellectual knowledge of the market, you know, the kind of information that you wouldn't be privy to as a layperson.  But it is not rocket science; it is pretty easy to understand.  Basically we're investing in the land, in order to fund our investments, we need to take on other investors, so that is the way we work. We tell you exactly how, and why we've invested in these plots of land, therefore you should."

Anyone, who didn't know better, might imagine that in the penultimate sentence that Nuttall is constructing a pyramid. Incidentally Nuttall appears to be among old acquaintances. A David Jackson of ELSP told Australia's Sunday Age that "We buy fields where you're not allowed to build, where there's no planning permission," says Mr Jackson. "It's speculating on land. We keep some of it for ourselves, and subdivide the rest into small blocks which we sell to private investors."

But to return to our industrious friends:

'At paragraph 21, Mr Jenman describes our client, Mr Cleeve, as having a "shady reputation". This is damaging to both Mr Cleeve's personal and professional standing.  There is no evidence at all that our client is "shady" or somehow to be avoided by those with whom he does business.'

It is, of course most unfortunate that there should be any suggestion, even the merest scintilla, that Mr Cleeve has a 'shady reputation'. As far as investdrinks is aware the only possible blemishes on Cleeve's business reputation are an eight-year disqualification from being a UK company director (29.2.2000 to 7.2.2008), being a director of two companies (Napier Spirit Company Ltd and Forrester & Lamego Ltd) that were closed in the public interest by the DTI) and being a director of a company (Napier) that was investigated by the UK Serious Fraud Office, although no charges were ever brought and the investigation was closed. The very idea that Cleeve is 'somehow to be avoided by those with whom he does business' is patently laughable. Why Mr Cleeve is nearly a captain of industry! Surely someone at Farrer's ought mention Cleeve's sterling work in selling UK agricultural land as far afield as Australia to one of their Royal clients and a suitable gong could be procured for him.

In view of Stephen Cleeve's professional standing it is a complete and enduring mystery why he does not rate even a mention on European Land Sales Partnership's web site. It is evident to investdrinks that Stephen is being far too modest: a pic plus his remarkably distinguished CV on the 'Team for Success' page along with John Beckwith-Smith and Jerry Smith would add immeasurably to the force of the partnership's pitch.

Farrer's letter goes on to demand. 'In light of the highly defamatory content of the article, we require you immediately to remove the article from your web site and to make it unavailable to Internet users. We also require confirmation by way of formal undertaking from you that you will not, in the future, publish the same or similar defamatory allegations about our clients.  Our clients also require their legal costs to be paid in full.'

They also threaten to get the offending article removed from Jenman's ISP. 'For the time being we have not sent a copy of this letter to your ISP but we reserve our right to do so without recourse to you.  If the article has not been removed by the deadline of 29 October, we will contact your ISP immediately to ensure it is removed.'

As with the Guardian, Farrer's stiffy appears not to have had quite the response they might have hoped. Neil Jeaman has told Farrer & Co 'Please inform your client that I stand by my comments.'  Nor at the time of posting had the offending article been removed from the site.

But one racket we have not seen in Australia is the Land Bank scam'
(Posted 18th October 2004)

Land scammers alleged to be targeting Australians

It looks possible that the visits by the enterprising Stephen Cleeve to property exhibitions in Australia may have had mixed success. Following his recent appearance at the Melbourne Property Expo held at the Melbourne Exhibition & Convention Centre from the 8th - 10th October, Neil Jenman of jenman.com.au and on Propertyreview.com.au has written an article entitled 'The land bank scams'.

Propertyreview.com.au is published every Wednesday and delivered to the desks of more than 30,000 subscribers. It is also updated daily with Breaking News. Its web site claims that 'Propertyreview.com.au is recognised as Australia's most comprehensive source of property news, opinion and research'.

investdrinks is relieved to hear that the situation is not entirely gloomy as Daniel Nuttall of the European Land Sales Partnership explained to Jenman.

'Last night, speaking from England, Daniel Nuttall, who described himself as "one of the ELSP senior consultants", hinted that his company had the low-down on the best growth areas in England. "This is the kind of information you wouldn't be privy to as a lay person," he said.

When asked how many Australians had bought land from ELSP, Nuttall said, "Oh, quite a few Australians have come on board."

That's why Stephen Cleeve, the boss of ELSP, wants to keep coming to Australia. "The show we did last week wasn't the only one we did. Obviously we've returned to Australia because they're successful."

investdrinks has to wonder whether this Daniel Nuttall is the same person as Danny Nuttall, who was a 'senior broker' with Claret Web scam company Goldman Williams Ltd, closed in the public interest in December 2001 by the UK Department of Trade & Industry. If this is the case, perhaps other sales staff from defunct Claret Web companies have now developed an interest in property.

Cleeve of Land Traders had two seminar slots in the Melbourne Property Expo, run by Australian Exhibition Services Pty Ltd - the same organisation that had provided him with a platform in Brisbane in August. On 7th and 8th October Cleeve spoke on 'How to Make Profits from Buying and Selling Land'. Land Traders also had a stand (B6) at the Expo. Intriguingly European Land Sales, the name used at the earlier Brisbane Expo, has been changed to the shorter, more snappy Land Traders for this exhibition. It is, however, still the same company: clicking on Land Traders on the exhibitors' list takes you right to the web site of European Land Sales Partners. investdrinks assumes that the name change is presentational and is not linked to the unfavourable Press coverage that European Land Sales Partnership has garnered. European Land Sales was also present at the 2004 Sydney Property Expo in mid-April.

It is not known whether in Cleeve's Melbourne talks he explained the secrets of how you can make a profit on land deals: i.e. how to turn £90,000 spent on agricultural land into £3.5 million or more. Mr Jenman's article suggests that Cleeve concentrated on promoting the appeal of buying some of Land Traders' (aka European Land Sales) plots.

Also speaking at Melbourne was Monique Wakelin of Wakelin Property, whose talk was entitled - 'Not all Property is Good Property' - and  Barry Pickering, of Onsite Direct Property Investment whose keynote speech was called - 'When the Going Gets Tough'. 'Not all Property is Good Property' is possibly a fitting title for the ELSP site at Mead Lane, Eynsham, Oxfordshire, where some nine plots have been sold According to the area planning manager for the West Oxfordshire District Council:

'The site to which you make reference is located outside of the village in the Oxford Greenbelt and in the floodplain. In light of the above, given present land-use planning policies the land to which you make reference has no residential planning potential. Any planning applications for housing on the land would be recommended for refusal on the grounds that such development is contrary to the Housing, Environment and Green Belt policies of the Adopted and Emerging Local Plans."

investdrinks trusts that the buyers of the plots are either long lived optimists or that they intend to build Noah's Arks on their plots. investdrinks understands that ELSP are now offering plots near Poole Lane, Umberleigh, North Devon. Perhaps this site will provide the poor old plotters with a better chance of a return than appears possible at either Milton Keynes or Eynsham - a marina anybody?

On October 13th 2004 Milton Keynes Council agreed to an Article 4 Direction on the land at the Bow Brickhill site. An Article 4 notice removes even the small development rights the land originally possessed and should protect the fields from any posts or fences being erected to mark off plots.

Given Mr Cleeve's sterling efforts to develop business in Australia, all of this is most unfortunate. Whether the publishers and author of the trenchant article (But one racket we have not seen in Australia is the Land Bank scam') will receive a solicitors' stiffy from Farrer & Co, whose clients include the British Royal family, remains to be seen. Farrers have already sent a couple of stiffies to the bowbrickhill.com site complaining of links to defamatory material published on the internet.

Apparently according to a letter dated 30th September Farrer & Co are 'currently in correspondence with The Guardian as to the accuracy of that article (26.6.04)* and we have reserved our clients' rights to take legal action about it should this prove necessary. Through the bowbrickhill.com weblink, you are further publishing that article as a result of this link. You are therefore alleging that our clients are involved in a "scam". This is defamatory and untrue.' Letter also demands that the bowbrickhill site will not 'make or repeat any allegation (whether explicitly or implied) that our clients' current business activities involve a form of "scam" which the public should be on their guard against'.

* investdrinks understands that The Guardian's response was exceedingly short and to the point and that so far, there has been no further response from Farrer & Co..

Farrer & Co was founded early in the 17th century. The firm's web site explains that 'we pride ourselves on the fact that our advice is reliable, pragmatic, commercial, honest and carefully considered. It is also provided discreetly, with understanding, integrity, a sense of humour and careful attention to detail. Many of our lawyers are recognised as leaders in their chosen fields.  We have a long and interesting tradition, dating back over 300 years, of being at the forefront of legal changes and developments. We have lawyers on Government advisory panels and have been involved in many of the key landmark cases shaping the law.' For further information on their 'long and interesting tradition' and 'careful attention to detail' please visit farrer.co.uk

Stephen Cleeve at Property Expo 2004, Brisbane

One of the seminars at the recent Property Expo 2004 at the Brisbane Convention & Exhibition Centre on 20th - 22nd August was given by Stephen Cleeve of the European Land Sales Partnership speaking on European land sales. Two of the speakers prior to Cleeve were due to speak on 'How to avoid getting caught out! Your rights when buying residential property' and 'What are speculative bubbles?'

Might Mr Cleeve have whetted his audience's appetite for a shrewd investment by mentioning the new plots on Mead Lane, Eynsham near Oxford that European Land Sales partnership are now offering? 

Sadly investdrinks has no idea how Mr Cleeve was introduced to his Australian audience but in any event it is unlikely to have included this 'tribute' from Ken Bates, former chairman of Chelsea Football Club, which apparently appeared in the Chelsea v Tottenham Programme in the Chairman's column on Saturday 1st February 2003.

'We have a supporter whose actions are bringing Chelsea's name into disrepute in the game. His name is Stephen Cleeve and he runs a web site where he flogs memorabilia. His speciality is trying to obtain free tickets for away matches from the home club. In Stravanger he was ejected trying to use somebody else's press pass. At Old Trafford he tried to get a Director's Box ticket on the grounds that Chelsea had overlooked him. At Shrewsbury he posed as a potential investor to try to gain access to the Board Room. We are tired of his shenanigans and have suspended his membership to the Executive Club. Please don't let him in on your ticket - he's not worth it.'

investdrinks trusts that Cleeve's itinerary for his Australian jaunt gave him time to meet up with William Beasley (William Buchanan & Co Ltd/ Gleneagles Spirit Management) now of WineOrb to discuss failed whisky investment schemes.

Stephen Cleeve mentioned but not named in UK parliament
(Posted 6th August 2004)

In a debate on early day motions in the House of Commons on 22nd July 2004 Hansard reports on comments made by Brian White (MP for Milton Keynes, North-East) (Lab): 

'I read with interest early-day motion 1496, which is about unscrupulous property developers from Bromsgrove, who divided up fields and offered plots for sale. A European land sales partnership is doing something similar in a lovely village called Bow Brickell in my constituency. It is offering a field for future homes and taking money now with a promise of a home in the future. The person responsible has bought a field for £90,000 and stands to make £3 million. There is little chance of the field getting planning permission, but the developer's information advances the growth of Milton Keynes as an inducement. As well as stressing the points made in early-day motion 1496, I emphasise to the Deputy Leader of the House that someone (Stephen Cleeve - investdrinks) who has been barred as a company director is running the scheme and gets round the law by forming a partnership. I ask my hon. Friend to take up with the Department of Trade and Industry not only closing the loophole that allow scams such as those in Bromsgrove and Milton Keynes to occur, but extending the bars on directorships to partnerships.'

'Early day motion 1496
1496 UNSCRUPULOUS PROPERTY DEVELOPERS IN BROMSGROVE 12:7:04
Miss Julie Kirkbride
Tim Loughton
Mr Keith Bradley
Mr David Drew
Mrs Ann Cryer
Lynne Jones
* 9
 

Mr Huw Edwards

That this House deeply deplores the unscrupulous activities of a company called Property Spy operating in the Majors Green area of Bromsgrove who are dividing up fields in the greenbelt and offering plots of land for sale with the implication that they will be eventually allowed planning permission for a house; is particularly concerned that the company is targeting hard working Asian communities and others who may not realise how speculative this investment may be; believes that the company seeks to deliberately mislead its clients as to the prospects of future planning by showing them newly-built houses in the area; and calls on the Government to take urgent measures to stop this blight on the countryside when these parcels of land are subdivided and protect the hard-earned savings of families taken in by the hard-sell techniques and unsavoury tactics of these scam operators.'

Brian White is quite right (amend from quote) to urge the closing the loophole that allows disqualified directors to run a partnership. It is equally ridiculous that the DTI cannot investigate the activities of these partnerships or those of sole traders because it is outside their remit.

Stephen Cleeve and European Land Sales Partnership
(Posted 5th July 2004)

Stephen Cleeve and European Land Sales Partnership has continued to attract media interest. Tony Hetherington: Financial Mail on Sunday (4th July 2004): Update: Banned boss in £3m con Hetherington wondered: 'Why is this business operating as a partnership and not a limited company? Well, it could be because boss Stephen James Cleeve is banned from being a director of any company until 2008.' (thisismoney.com/20040704/si80023.html)

Potential investors considering purchasing a plot of land near Milton Keynes may find the informative local site (bowbrickhill.com) useful. It carries important information from The Milton Keynes Council about the site being offered by European Land Sales Partnership:

'The site is not allocated for development in the Local Plan
*   It was not discussed at the recent public inquiry into the Local Plan
*   European Land Sales have had no discussions with the Council about the feasibility or likelihood of the site coming forward for development.'

On 19th June The Telegraph published an article called Turf War about similar schemes run by Canadian entrepreneur Baron Deschauer (telegraph.co.uk/property/main.jhtml?xml=/property/2004/06/19/prlan19.xml)

European Land Sales Partnership
(Posted 29th June 2004)

Readers of the Guardian's Jobs & Money section (26.6.04) will have seen an article by Tony Levene: Investors who hope to have a field day. Levene covered the recent tendency of investors to be offered small plots of agricultural land that might in time acquire planning permission. The article pointed out the pitfalls that can occur with this type of investment. European Land Sales Partnership and English Land were the two companies cited.

European Land Sales Partnership is run by John Beckwith-Smith and Stephen Cleeve. The partnership is currently offering plots on their 'latest land opportunity' - 3.5 hectares near Milton Keynes. The plot was bought by Stephen James Cleeve on 18th March 2004 for a stated price of £90,000. Further details can be found on europeanlandsales.com

Cleeve used to be a director of Napier Spirit Company (investments in casks of whisky - closed by the DTI - February 1997) and Forrester & Lamego (investments in Champagne and vintage character Port - closed by the DTI - July 1997). He is disqualified from being a UK company director from 29.2.2000 to 7.2.2008 . This disqualification, of course, does not preclude him from running a business partnership. 

investdrinks understands from solicitors, Shaw & Croft, that although they acted for European Land Sales Partnership in purchasing the land at Milton Keynes, they are not the partnership's solicitors. Shaw & Croft believe that the Milton Keynes site is the only one so far purchased, although there are a number of other sites that the partnership is interested in.

Levene's article is available at: guardian.co.uk/guardian_jobs_and_money/story/0,3605,1247203,00.html