ERUDIO student loans help

Sarebear78

anna2007 wrote: »

Hopefully BIS can give us some answers, so here's a new FOI request which covers the credit licence... and a few other problems/issues/scenarios:

https://www.whatdotheyknow.com/request/erudio_student_loans_limiteds_fa/new

Good FOI request - if you get the 'it'll take too much time/money' response - let me know as I will happily take some sections and ask them for you (or us, really).

I am really interested in which scenarios would lead to the loans being returned to BIS/SLC (if any!). They must have written SOMETHING into the agreement, surely??

anna2007

It looks like the panic/excitement over the annual accounts might be over, Companies House website is now showing Erudio's accounts available to order, date on CA website 09/01/2015:

http://wck2.companieshouse.gov.uk//wcprodorder?ft=1

I think the link maybe times out, if so you can access Erudio's record here, enter Company Number 08605918, then click "Order information on this company, document type AA is the Annual Accounts:

http://wck2.companieshouse.gov.uk//wcframe?name=accessCompanyInfo

I've ordered and downloaded the annual accounts, the GAZ1 Notice to strike off and the AR01 Annual Return/Statement of Capital (couldn't resist, as only a quid each).

I've not read the annual accounts yet, but I'm assuming it's ok to share my downloaded copy here, as it's now a public record - does anyone know for sure?

Edit: Can't see anything on the CA website preventing me from sharing, so here are the accounts,although it's as we expected - they're pretty much an empty shell, our loans aren't even in there, but on Arrow Global's balance sheet:

https://www.dropbox.com/s/p60zzlcy9bw4o4a/Erudio%20Annual%20Accounts%20to%20311213.pdf?dl=0

They do show a bank balance of just over £2 million, which is mainly the loan payments collected "after payment of the expense of the Company".

I think the receipt on the first page shows the document received by Companies House as 23/12/14, so maybe there's a problem with the accounts and they have to resubmit? Here's a copy of the GAZ1, which is post-dated with tomorrow's date:

https://www.dropbox.com/s/mf933uo1hkmeytt/GAZ1%20Companies%20House.pdf?dl=0

erudioed

Nice one Anna. That Companies House 3 month warning is actually dated tomorrow, the15th Jan. I didnt see this years accounts available though, but maybe i didnt look well enough. I guess it will become clear in the coming days.
The 2013 Erudio doc though explains exactly how the consortium is operated. Another name also enters the fray as The Beneficial Title Holder, alongside Arrow Global which shares that title:
HARROGATE HOLDINGS LP



HARROGATE HOLDINGS LP was formed on 2013-08-06 in Delaware by THE CORPORATION TRUST COMPANY.

The Registered Agent on file for this company is The Corporation Trust Company and is located at Corporation Trust Center 1209 Orange St Wilmington, DE 19801.

Odd that, its based in Wilmington, where have i heard that name before. Oh, and it looks like shell company but in the US this time. No mention of Carval anywhere, so maybe they have their hands all over this shell company (along with those other consortium members yet to be named).
And just for the record, here is a list of what looks like the other shell companies that The Corporation Trust Company is the registered agent for: http://www.bizapedia.com/addresses/CORPORATION-TRUST-CENTER-1209-ORANGE-ST-WILMINGTON-DE-19801.html


For all intents and purposes, the Erudio accounts also show that Capita Customer Management Limited basically control everything apart from making decisions about the company as a whole.
From what i see, Capita takes all the cash Erudio makes and pays it over to Arrow Global and Harrogate Holdings LP, after Capita has taken its own operating cut!
It also states that Erudio's accounts dont have the loan portfolio figures. They are in the 2 above companies financial statements (and their corresponding shares of the loan deal).

anna2007

@ erudioed The doc linked to is the missing accounts, for year ended 31/12/13 - think I said 2014 in an earlier post, but just getting muddled as we're into 2015 now! So the 2014 accounts won't be due to be filed until September this year.

It's strange though that they're date-stamped 23/12/14 on the first page - I suppose that could be either the date sent by Erudio, or the date received by Companies House, but either way, why all the fuss with the GAZ1 if Companies House have had the accounts for the last 2-3 weeks?

Maybe the accounts didn't convince them that Erudio are "carrying on business or in operation", given that they don't actually exist!!

Brooker_Dave

What's the bit about the discretionary charitable trust all about?

anna2007

Brooker_Dave wrote: »

What's the bit about the discretionary charitable trust all about?

A tax dodge? Not quite sure how they've convinced anyone of their charitable status... backhanders during lunch maybe, that could be classed as being charitable to the recipient?

Just under that, it states that only loans in arrears and deferred loans were included in the portfolio - not quite what the Government press release said, where the 17% of loans in repayment were also included in the sale.

They must be excluded, otherwise they'd have much more than £2million sitting in the bank.

erudioed

anna2007 wrote: »

@ erudioed The doc linked to is the missing accounts, for year ended 31/12/13 - think I said 2014 in an earlier post, but just getting muddled as we're into 2015 now! So the 2014 accounts won't be due to be filed until September this year.

It's strange though that they're date-stamped 23/12/14 on the first page - I suppose that could be either the date sent by Erudio, or the date received by Companies House, but either way, why all the fuss with the GAZ1 if Companies House have had the accounts for the last 2-3 weeks?

Maybe the accounts didn't convince them that Erudio are "carrying on business or in operation", given that they don't actually exist!!

That article on thisismoney.co.uk said the guy had contacted Erudio and they confirmed the accounts hadnt been filed, so it is a bit hazy actually whats going on. I am sure we will get an answer or clarification soon but i like your reason, it could be close to the truth. Its odd the companies house doc is dated tomorrow the 13th.

That charitable trust thing is very interesting actually, maybe Fermi could illuminate?

Concerning the 2 types of loan. Be me one to defend the headless ogre, but I would assume as they havent been fully paid, the use of the word deferment may account for those accounts paying back now, as at some point i am sure they must have been deferred for a longish time for them to be still in the process of being paid. Just a guess though.

I think the 2013 accounts said Capita handle all the money and pass it on to Arrow Global and Harrogate Holdings LP, after taking their own cut, and that Erudio doesnt see any of the money, other than its cut for setting up the company and giving a business address etc. The more i think about out and come across, the more perfect the term shell company is. I am just amazed they are allowed considering how clearly dodgy the whole idea is and how it allows these companies to conduct business behind a wall of invisibility.

Mr_McGuffin

Thank you very much all for finding and posting all the info today.

What about this in the Strategic Report of the Annual Report:

'Capita Customer Management Limited was appointed by the parties to act as the Primary Servicer of the Loan Portfolio with Arrow Global overseeing Capita Customer Management Limited with respect to those loans in arrears.'

As far as I can see it doesn't say Arrow oversee Capita for the 'loans for which repayments have been deferred' that it mentions earlier. Does someone else oversee those? Or is it an error or omission? Why then does it specify Arrow oversee the loans in arrears, when it could just say Arrow oversee Capita for all the loans? Or is just Capita who handle deferred loans, with nobody else 'overseeing' it?

Brooker_Dave

"1.3 Q: How is secrecy obtained through trusts?

This happens in several layers. The first two described below are specific to trusts; the others are techniques commonly used with trusts but which are common with other structures, such as companies, too.

In a first layer, trusts create a legal barrier between the trustee, on the one hand, and the settlors or beneficiaries, on the other – and in the process this creates the potential for an information barrier in the same place as the legal barrier. Even if you can find out who a trustee is, the trustee may be bound by a confidentiality arrangement not to reveal who the settlors or beneficiaries are. Often, and especially in a secrecy jurisdiction, the trustee will be an anonymous trust company that specialises in being a trustee for many thousands of trusts, and there will be no obvious clue to suggest who the settlors or beneficiaries might be."

" For example a trust’s assets may be shares in a company controlled by nominee directors in a jurisdiction where it is impossible to find out who the company directors are or what the company does. That company’s assets may also turn out to be deposits held in a bank account in a country with strong bank secrecy laws. This layering process can, and frequently does, go on for several more steps, making it fiendishly hard for the forces of law and order to work out what the trust is really about – if they can identify it in the first place."

"1.6 Q: How are trusts used to avoid and evade tax, in theory?

In summary, two main themes are involved.

First, because a trust creates a distinction between the legal owner, the trustee, and the beneficiary, this complicates the issue of how to tax the trust. This creates many avenues for both avoidance and evasion.

Second, because trusts create the potential for great secrecy, tax authorities cannot easily find the assets to tax them. This typically creates possibilities for tax evasion. Often the two themes: the legal distinction, and the secrecy, apply simultaneously.

In theory, once a settlor passes the assets into a trust, he or she no longer owns it, so cannot be taxed on its income. So a settlor should not be a beneficiary too. If a settlor could say in the deed of settlement: “make all the assets available to me whenever I want them” then the tax authorities could judge them still to be the real owner of the asset – and tax them on the income. If the ownership were not really split, what would the point of a trust be? The property would be owned absolutely by one person, for own benefit.

However, as explained above, if the settlor is able to pretend to let go of the assets in order to escape a tax bill, while not having let go of them in reality, then he or she may be able to enjoy the income or other benefits of the asset without paying tax. The question of whether or not the settlor has really become separated from the assets can be a legal grey area, raising difficult questions over whether this is avoidance or evasion."

Brooker_Dave

"Small and medium-sized companies and limited liability partnerships (LLPs) can benefit from relaxation of the general requirement to supply full, audited accounts to Companies House.
In many cases they can prepare and file shortened versions of their accounts."

But will they get away with that for the next financial year?