18 February 2005

This is the fourteenth public statement we (the FSA) have made about KF Concept. It is an update on the position reached in the bankruptcy proceedings against Mr Kevin Foster (Mr Foster).

Court hearing on 4 February 2005

Mr Foster filed an application at Court to lift the sanction in the order of Registrar Nicholls dated 22 December 2004 so he may be permitted to file further evidence opposing the bankruptcy petition after 7 January 2005.

Mr Foster's application was due to be heard on 4 February 2005 at 12:30pm. However, Registrar Simmonds, who would have presided over that hearing, adjourned it. Because Mr Foster's representatives were late in delivering the papers to the Court, the Registrar said he had not had sufficient time to read through the material and prepare for the hearing so that the matter could be dealt with in the time available.

The Registrar adjourned the hearing of Mr Foster's application to 10.30am on 17 February 2005. He indicated that the FSA could seek its costs against Mr Foster for the hearing of that application.

 

Court hearing on 17 February 2005

At the hearing on 17 February, Mr Foster, the Concept Members Action Group (CMAG) and the FSA were represented.

Stephen Gilchrist, on behalf of CMAG, confirmed to Registrar Simmonds that the FSA and CMAG had agreed to a variation of Registrar Nicholls’ order of 23 November 2004. So CMAG now has until 31 March 2005 to file the notices (Form 6.20) showing the creditors' intention to support or oppose the bankruptcy petition. The Registrar approved the agreement we and CMAG reached and Mr Gilchrist then left the Court.

Registrar Simmonds heard submissions on Mr Foster's application by both Mr Foster's and our Counsel. The Registrar focused on the fact that, as these were bankruptcy proceedings, Mr Foster should be given the opportunity to say all that he wants. However, any extension of time would be "on fairly sharp terms".

Registrar Simmonds directed that the order of 22 December 2004 be varied to allow Mr Foster to file further evidence opposing the bankruptcy petition by 4.30pm on 24 March 2005. After this, he would be debarred from filing further evidence and his opposition to the petition would be limited to the evidence filed by that time. He also ordered that the FSA be allowed to serve evidence in reply to Mr Foster by 4.30pm on 28 April 2005.

In light of the fact that Mr Foster had brought the application and that the hearing of 4 February 2005 had been adjourned in the circumstances described above, we sought an order for Mr Foster to pay our Counsel's costs incurred in connection with that application. We limited the costs sought to only those for our Counsel – a total of £2,500 (plus VAT) covering both hearings. Having heard submissions from both parties, Registrar Simmonds acknowledged the history of the case and ordered the sum for our Counsel's costs to be paid within 28 days.

Individual Voluntary Arrangement (IVA)

We have been approached by an Insolvency Practitioner who is considering whether to accept an appointment as prospective supervisor of an IVA for Mr Foster. We have met him and will shortly meet with solicitors acting on the Insolvency Practitioner's behalf to discuss the position further.

We will review whether the bankruptcy proceedings should continue in the light of developments, in particular regarding the suggested IVA.

Other statements regarding KF Concept

See the List of KF Concept statements for all the statements we have issued on this subject.

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