Administrators appointed to Signature Capital

According to the Gazette, the parent company of Signature Capital, Signature Living Hotel Limited, has been put into administration.

Duff and Phelps were appointed as administrators. Other collapsed unregulated investment schemes currently administered by Duff and Phelps include Blackmore Bonds and Carlauren.

Signature’s problems paying investors have been well documented over the last year.

In January this year Signature Living Hotel took two investors to court in attempt to prevent them serving winding up petitions on the company. Both investors loaned money to Signature Heritage (Belfast) Limited, with a guarantee given by the parent company Signature Living Hotel.

Signature argued that the guarantee – a guarantee that Signature had made much of in its investment literature – was invalid, because it hadn’t been witnessed, despite it being signed by sole director Lawrence Kenright.

The judge “had no hesitation” in throwing out this argument and allowing the investors to proceed with their winding up petitions.

I reviewed Signature’s investments in May 2019. I pointed out that, despite Signature’s claims on its website to offer “a safe place [for money]” and “fantastic returns in a secure environment”, its investments offering rates of up to 16% per year were inherently high risk.

A couple of weeks after I posted my review, Signature’s lawyers took umbrage with this entirely factual description, and threatened to sue me for defamation.

You state that it is “misleading” for our client to promote its product as “safe” and “secure”. The quote you refer to was however given by a third party investor [Brev: this is irrelevant as Signature chose to use that testimonial in its marketing, and remains responsible for its own marketing] and our client maintains that the nature of the guarantee given to investors by Signature Living Hotel Limited gives significant comfort to their investors.

Your article wholly fails to explain that the loans are guaranteed by Signature Living Hotel Limited, a company that you do note has significant assets. Your failure to appreciate this may have clouded your judgment in relation to the investment generally.

So let’s recap: Signature paid money (actual investors’ money) to get their lawyers to threaten me with a lawsuit. On the grounds it was defamatory (it wasn’t) to describe their investments as inherently high risk (they were), because I hadn’t understood their super-duper corporate guarantee (I had).

Less than a year later, Signature attempted to argue that this guarantee they threatened to sue me over didn’t actually exist (for two investors), on the basis that director Lawrence Kenright’s signature hadn’t been witnessed.

Just another year in the life of an unregulated investment scheme.

Signature’s attempt to wriggle out of the guarantee failed because, as the judge ruled, both parties clearly intended for this guarantee to form part of the loan contract, therefore it didn’t matter that they forgot this formality.

As Signature didn’t attempt to argue that the guarantee wasn’t supposed to exist, its argument was one level above “it doesn’t count because we had our fingers crossed”.

Signature Living Hotel has previously survived two winding up petitions, which were dismissed in September 2019 and March 2020. With that in mind, I’m saving Signature’s full obituary for when more details of the administration emerge, so more details as and when they appear on the public record.