70% Below Market Value?

Trashed, structure or flood, bank resale, etc etc etc

Properties are sold cheap for many reasons but this is one possible dreadfully corrupt but, as far as I know, still legal scenario. Maybe there are some legal eagles out there who can put the Jonny Badboy’s of this world in jail for me.

So we have this business owner. Let’s call him “Jonny Badboy”. The business is earning money and is going along fine. Jonny is close to retirement and has been trying to sell his business for the last few years but unfortunately he’s been unable to sell it.

The business has always paid suppliers on time but recently has been running up a lot of dept with trade creditors and is stretching them all out to 90 days. They accept and extend the credit terms. After all, Jonny Badboy has always paid their account and the suppliers don’t want to loose the business.

As Jonny Badboy is close to retirement and decides to pays himself a “well deserved” but huge bonus that year. The bonus is so handsome that now the business cannot hope pay any of it’s accounts. Jonny Badboy uses the huge bonus to pay off the mortgages on all IP’s instead of using the businesses money to pay it’s suppliers. Jonny Badboy then transfers all the now debt free IP’s into his spouses name at crazy cheap prices (as you see here) and even avoids paying much in stamp duty. Then, because he hasn’t paid his suppliers, they force him into receivership and he declares personal bankruptcy. As none of the IP’s are in his name and he’s now a bankruptee the trade creditors can’t touch him and he sails away into the sunset, spouse by his side, with all his suppliers money.

As he’s close to retirement he doesn’t give a rats that he’s declared himself bankrupt and he knew that he was never going to be able to sell the business for anywhere near 90 days worth or trade credit so he justifies to himself that this was his “only option”. He did it for his kids.

Dirty rotten scoundrel.

• This reply was modified 6 years, 5 months ago by  Ben. Reason: expletive changed
• This reply was modified 6 years, 5 months ago by  Ben.

Sometimes it can be a mistake from the agent too.
other times some people hate agents and sell too cheap as a result .