what do you think ?
Has Steve Longworth committed a crime ? The evidence suggests that the answers may be worth looking into but no-one seems prepared to Act…. why is that ? If, as he claims, he did his Duty as a Trustee and told Accountants about the crown holes why does he not prove it ? By saying he did his Duty as a Trustee, he says he did; but several Accountancy companies have written that he didn’t. Both Steve and the Accountants cannot be correct (unless Steve thinks he didn’t have to tell them ? but is this likely given that he felt “obliged” to tell the OSCMs insurer)
False accounting
audit
OSCM Articles require an Audit, but Steve refuses to do one. He states that as the Company is small it is not required. Whilst that may be correct under Government guidelines for Companies (see below) it is not the point.
Companies limited by guarantee, especially those whose Trustees are ALSO the GUARANTORS have ARTICLES that require an Audit to ensure there is no impropriety. IF it was the intent to not require an Audit if the Companies Act does not require it, there would be no need for a clause in the Articles. However there is one and an audit should seems to be REQUIRED.
When creating accounts, Trustees and Directors should taken account of what they are used for. In this case it is for the operational activities of the Company but also importantly to allow house buyers to understand the liabilities they are accepting when becoming Members.
Steve thinks this liability may be beyond the ability of many to pay and yet it is impossible to discern this from historic accounts.
Significant accounting decisions are being made by Steve, and it is not clear he is qualified to make such decisions. These include:
- not disclosing details of the collapses, estimated cost of the repairs, refusing to do a Survey advised by Experts and approved by Members
- making no attempt to quantify the known liability of future collapses that experts have said can happen at ANY time (albeit of unknown timing). Prudence would suggest this liability needs to be better described in the Accounts.
- not disclosing experts have said that a Survey of company land is needed, and what it would cost
- if the company owns land, not attributing any value to it
- despite referring to litigation at AGM not adding any liability (lates case incurred costs of over £90,000)
why not audit / tell accountants
Opus Accounting stated “we confirm that we were not told of the crown holes when we issued the Accounts”
Given the Complexity of the issues that Steve and OSCM face one would think that it would be sensible, desirable and possibly even required for the Trustees and Directors to have had an audit, even if the Articles didn’t requires it. Are they all not horribly conflicted. The items in question cover hundreds of thousands of pounds, well beyond the resources of the Company to pay, and if Steve is right potentially Members to pay should the liabilities accrue in any given year.
The reasons for not auditing may relate to:
- the possibility that an auditor might create a large liability and insist the company puts in place a way to ensure payment when it accrues. Steve has stated that he thinks it is possible that not all Members could pay, leaving the company exposed. As it seems there is no insurance available this might mean holding cash against the liability which the Directors/Residents would have to pay
- the damning PBA report would probably be disclosed having an affect on the homes and their prices
- the audit might have affected the ability of Trustees/Directors to insure and sell their homes
- drainage and road repairs might be more accurately assessed
- risk of litigation liabilities may be included
was steve right to change oscm articles without all members agreement?
what are the implications of not sharing important data with accountants and guarantors ?
- SL made an agreement with Council, it is not clear if he asked all the Residents first ? letter to council FROM STEVE LONGWORTH
- Council produced the report he asked for, SL commented on it. (see above)
- Knowing there was no recourse against the builders, Clancy, and the damage it would cause, SL (with Vaughn Jenkins) sent it to Residents
- A Meeting was held (not recorded) and Residents rejected doing a Survey
- Up to 2020, the Company did not mention the crown holes or liability in the Accounts or when buyers were invited to become Guarantors
- Company (SL) does not mention crown hole liability and lack of subsidence cover to prospective Guarantors (buyers/neighbours).
actuary and trustee ?
It is unclear why Residents have not held Steve Longworth accountable for asking the Council to create an expert opinion about the site. To be fair: the Council and Stantec (PBA) haven’t acted well either. The Council say they had no duty to publish the report, paid for with public funds and Stantec, hid it from their mining database (that buyers rely on) meaning that, if, as it seems has happened, Residents and Steve Longworth hide the report, there was no way to find out it existed when you bought (the Accounts still don’t mention the Report).
It is hard to imagine, that a Professional, with Steve Longworth’s credentials and experience, would not think buyers and guarantors would want access to the PBA Site Report, and in particular; Steve’s views on what the report means for Guarantors. He states “the potential liabilities …may be beyond the financial capacity of many, if not all, residents.” Yet, for many years, nothing was shown in the Company Accounts.
- Is it possible Steve Longworth didn’t understand what he was doing ?
- He told the Company insurers about the first hole, and they removed subsidence cover. So why not tell the Accountants ?
- Was he legally obliged to share the report from the Council with the Accountants? Are the Accounts False ? Why are they not updated?
- He notes in his letter to the Council the impact the report will have on people trying to obtain mortgages.
Are OSCM as guilty as the builders, Clancy ?
“why ask the Council for a report? why send it to Residents? why ignore and hide it?”
Fact or fiction ?
angel or demon?
There seems little doubt that a combination of the wrong drains being put in (by Clancy and passed by the Council) and years of neglect by OSCM ignoring the flooding caused by the drains, had an impact on or even led directly to the collapses.
Steve Longworth and OSCM state that they received legal advice telling them that there was no recourse against Clancy and or the Council. Steve refuses to produce this advice. There is no corresponding item in the accounts that can be linked to payment for this alleged advice and no reference to the Trustees hiring lawyers to advise them
This is what makes Steve Longworth’s and Vaughn Jenkins’ actions so hard to understand. Knowing this, and if they intended not to do a survey of the site, what possible good could have come from asking for the Council to do a report?
Steve Longworth recognises in his letter to the Council that everyone is worse off as a result of his request for a report. However he still sends the report to Residents, creating the burden that they must disclose it to buyers, insurers and mortgage lenders. Why do that ? He could have just refused?
Numerous excuses have then been made for non-disclosure e.g. the report was addressed to the Council not the Trustees/Residents but they seem to be baseless.