10 April 2022 - Chairman's Update

I have been in discussions with BBL over a number of months to try to agree a release which could be circulated to our group. For various legal reasons this has taken longer than I hoped but I can now provide you with an official statement authorised by the Administrator which deals with the question of UK loan note claims.

The statement, which officially recognises the comments I have made in the past, is set out below:

"There are a number of German legal issues, which we will resolve in the coming months. It is in our mutual interest to do this as soon as possible but there is an immense volume of data and complexity of financial information that has to be dealt with. There are also individual claims that have not been lodged in the right way or with the necessary documentation.

Once we have received the final legal statements from their counsel in the UK and combined these with the German legal analysis, we will be in a position to deal with the individual claims. Since we have received thousands of individual claims this will obviously take a while.

We would like to make clear that not a single claim has been rejected finally at this moment. We, BBL and our team of international lawyers are under the obligation to review all legal positions so no decisions on the final position will be until a later stage.

You need to do nothing at the present time and you will be contacted directly if and when any further documents, explanations or clarifications are required.

Further, the rumours saying that there is an obligation to file a lawsuit in Germany within ten days because the claim has been rejected is not correct."

24 November 2021 - Chairman's Update

I am now able to try to explain some of the issues with claims made in Germany but disputed by the Administrator.

This is a complicated matter which I have discussed at length with both BBL and my contact at the Financial Services Compensation Scheme (FSCS).

Firstly, I would state that under German Insolvency law once a claim is registered and not disputed it is cast in stone unless altered by other factors arising prior to any distributions by the Administrator. That means that before a claim is accepted it must be correctly verified. Consequently BBL must be satisfied as to the validity of a claim as accepting it is virtually permanent. Apparently, some German courts may take a less strict view but Bremen does not.

The issue has been confused as far as UK loan note holders go for two main reasons. In the UK we have other sources of redress which are not open to investors in other jurisdictions. As there was no centralised distributor of UK loan notes as elsewhere claims are largely made individually not collectively and the scope for confusion and error is therefore much greater. Add this to the fact that BBL have not yet gained all the information they seek regarding transactions and verification from the Dolphin records is also very difficult.

I have sent a number of emails to BBL pointing out the distress and annoyance that the apparent blanket rejection of claims has caused as it has come with no explanation or reason.

BBL were under the impression that nearly all UK loan note holders would be able to make claims from the FSCS and many claims have been disputed as they believed claimants could effectively claim from them as well as the FSCS. I have advised them that this is not the case.

Furthermore, I explained that many claims in the FSCS were still pending and that more claims had also been made to the Financial Ombudsman Service (FOS) and the Pension Ombudsman Service (POS). Some of these cases might take several years to resolve and they need to find away to allow people to lodge claims pending resolution.

I have been told that "disputed" does not necessarily mean permanently rejected and the translation is more a case of "not accepted at this stage".

Some claims are rejected as they are duplicated or lacking in information. Again, this can be resolved in time. BBL will advise me on how they propose to tackle this problem.

FSCS Claimants:-

If you have been paid by the FSCS they will make the claim in the liquidation. You do not have to. They will claim the full contractual amount including capital and interest. Any funds they receive back from the liquidation will be applied to that total claim .This means that if you have not been fully compensated by them for your capital and interest loss you will receive those funds until your claim is fully satisfied before they recover the sums they have paid out in compensation.

FSCS will not make any claim in respect of any costs you may have incurred in obtaining your compensation and these may possibly be claimed separately in the liquidation. I await advice on this.

03 September 2021 - Chairman's Update

I have now been able to discuss the Administrator's report with BBL as far as it relates to the interests of UK investors.

General Findings

I understand that there have been creditors claims registered for around 1.8 billion Euros against the various companies within the GPG group. Of these just under 800 million is against DC80. In total, 17 terabytes of data has been digitally recorded from around 1 million paper documents. Clearly this is a colossal amount which must be read and analysed in order for a fuller picture to emerge and it will take some time to complete this task.

GPG dealt with around 200 different properties throughout the years and there is already evidence of dubious transactions and granting of security with criminal intent. There are around 50 properties left which must be sold.

They are liaising with the Hanover Prosecutor's Office but the pace of investigation is inevitably slower than would be liked.

Creditor's Claims

BBL report that they will open the examination of creditor's claims on 23 September 2021 but it may be the start of 2022 before all claims are known and verified. I would urge everyone to ensure their claims are registered before this date and am aware that those using lawyers like Peter Mattil may already have confirmation of claim registration.

Legal Matters

BBL have retained the services of Ernst Young to conduct a thorough forensic survey of the financial records such as they exist and they will be charged with piecing together the financial structure and identifying items which may give rise to claims against recipients of monies in the past. It is thought that sums paid to some investors, the tax authorities, introducer's commissions and other parties could potentially be recovered.

Similarly, a full review of security held by third parties is underway and, in several cases, litigation is being undertaken to challenge sales by those who may not hold good security. Litigation funding has been secured to enable proceedings to commence in anticipation of proceeds from the sales of the first 20 or so assets which are being marketed.

We understand that the UK banks and Whites Group are also now co-operating with the liquidators and providing information they hold.

Summary

It is clearly going to take years to resolve all of the issues mentioned above and no one knows what the final outcome might be for UK investors. It is fair to say that it is unlikely that there will be substantial repayments of outstanding liabilities from the liquidation of the assets and even the litigation which is being contemplated.

08 June 2021 - Chairman's Update

As you should all be aware, Justus von Buchwaldt of BBL Law was appointed Preliminary Administrator of Dolphin Capital 80 & Kg (DC 80) on 17 May 2021.

There will also be a meeting of Creditors on 10 August 2021 to ratify the appointment of the administrator and the Liquidation Committee.

This means that the second phase of the insolvency of DC 80 is now underway and we can now expect to see some serious activity on the part of BBL to investigate exactly what went on, where all the money went, what can be done about it and to whom.

This process is going to be lengthy and involved so I do not expect to see results in the near future.

I am aware that BBL have written to all investors they are aware of but some of you may have been missed or changed address and their records will not be up to date.

The letter they sent and the claim form can be found HERE.

You must endeavour to file your claim by 23 July 2021 or you may face a late filing fee imposed by the court which we understand is 22 euros.

If you have had a compensation payment form FSCS or anyone else you will not need to file. Those of you who invested through a pension should check to see that the pension trustees are filing on your behalf and you should not declare your own bank details on the form unless you wish any return to be treated as a drawdown of your pension.

The section regarding powers of attorney only applies to those who are completing the form on behalf of someone else.

We suggest that where loan notes have matured the total including interest at maturity is put in the first box and accrued interest (at the contractual rate) is put in the second box. Where the loan note has not matured simply put the capital in the first box and work out accrued interest in the second.

Mark Hambling

04 May 2021 Chairman’s Update

RED ROCK

I spoke with my contact at BBL Law (the German Liquidator) last Friday and have been advised that the German Red Rock company (now called Anglian Estates GmbH) is now being dealt with by the court in Hanover. Justus von Buchenwald has been commissioned to prepare the expert report and it is expected that it will follow German Property Group GmbH (GPG)PG into liquidation.

Apparently there was some sort of merger last year whereby Anglia Estates GmbH was merged with a company called Anglia Estates Ltd in the UK. We took advice on the merger document and it seems that the liabilities were not transferred. Therefore, there is no straightforward way of putting the UK company into liquidation as no one appears to have invested in it. The money was largely, if not entirely, put through DC 80 and an asset is understood to be secured in one of the myriad of Dolphin Capital SPV companies which may or may not be part of the overall liquidation process. Once a Liquidator is in place in Germany the security and the asset can be investigated.

This means that it is not necessary for Red Rock investors to do anything more at this stage and it seems there would be nothing to be gained from attempting to deal with the Anglia Estates company in the UK. I imagine that the Liquidator in Germany will take such action if deemed necessary.

29 December 2020 - Chairman’s Review of the Year

In between the Christmas turkey and the onslaught of New Year’s Eve I thought, by way of an update, I would take the opportunity to review the year as far as GPG is concerned. It is a little over a year since the GPG Creditor’s Association was created from a small group of GPG investors who were tired of listening to the misleading information being provided by GPG. In essence, our mission is and has always been to ensure that the truth is known to investors; prevent any further manipulation of investors by Charles Smethurst and GPG; and to provide all investors with as many options for recovery as possible. The story has unfolded throughout the year and the events leading up to the filing for bankruptcy by GPG are all set out in our Dossier, which you can request by emailing gpgcreditors@gmail.com

As you are aware the first meeting of the Creditors of AS GPG German Property Group GmbH was held on 11 December 2020.This meeting was a formal affair, essentially to confirm the appointment of Justus von Buchwald of BBL as liquidator, and to ratify the membership of the Creditors’ Committee which will work with the liquidator in the future. No further information was provided as to the full extent of liabilities of either this company or the Group, nor was any information forthcoming over the level of assets or expected realisable values.

I hope that by the time the Creditors meeting is held for DC 80 there will be a little more information available, but this will depend on the progress of work being carried out by the Preliminary Administrator, Goerg, and the team of forensic accountants from Ernst Young.

Of course we will be very interested to learn of any information regarding asset valuations and levels of liabilities, particularly if the deliberations regarding security find in favour of the UK position….if securities are to be disregarded we will be in a much better position than if not. Any litigation undertaken in this regard by the liquidators is likely to be in our interest, even if it is paid for from asset realisations. I do not know when this meeting will be held but it appears that it may be February 2021 at the earliest. It is expected that the format of this meeting will follow the previous one and it will be something of a non-event, especially if there is no further information to be released.

There seems to be little we as a group can do to influence events over in Germany and the liquidation will progress at its own pace. The BBL website will be continually updated and I will maintain contact with the liquidator. I imagine the process will be slow with long periods of apparent inactivity with nothing important to report whilst the work of the Administrator and forensic accountants continues in the background. Any major developments will be made known as the process moves forward as part of the function of the liquidators is to discuss findings with the Creditor’s Committee where many of the group have direct representation through Peter Mattil.

Mattil will also be advising his clients of secondary actions that may be viable. We are aware that the Prosecutor’s Office in Hanover also has a file open on Smethurst and two others and is investigating. I also understand that various creditors are considering pursuing private prosecutions. The general feeling over there is that, due to press and TV exposure, the politicians are now showing an interested and we can be assured that this matter is not going to be dismissed.

In the New Year we will be concentrating our efforts on persuading the Regulatory Authorities to investigate the activities of organisations and individuals in the UK to ensure that any wrongdoing is uncovered and dealt with. Our campaign with Members of Parliament appears to be showing promise and we are setting up meetings with interested MP’s to explore ways in which they can help us. I do not know how successful we will be, but for those who are unable to make claims through the Financial Ombudsman or the FSCS we are hopeful that our efforts will be complimentary to the action under consideration by The Claims Bureau.

A quick reminder if I may that your committee members continue to give their time free of charge, and are covering all expenses, including travel to Germany, out of their own pockets. Whilst it is not compulsory, we would be very grateful if you would consider donating to the cause and supporting the efforts of the committee in trying to maximise the returns to investors. You can donate via PayPal my following this link.

It is my hope that 2021 will see some improvement in our mutual positions, but I do believe this is going to be a long haul and we need to be patient as well as resolute.

In any event I would take this opportunity to wish everyone the very best for the New Year.

Kind regards

Mark Hambling

Chairman

GPG Creditors Association

22 November 2020 - Chairman's Update

There is a "Rumours" section on the Liquidators website. We do not know who the "someone" is that they refer to. They go on to make reference to the salient points i.e. German Law does not permit a take over of the assets by creditors, claims must be made by the legal claimant, no asset sales or transfers will take place until such time as the relevant Special Purpose Vehicle (SPV) is in liquidation and a full investigation into the security position and evaluation of the asset(s) has been carried out. No date for claims against DC 80 (majority of UK creditors) has been set as it is not yet in formal liquidation. Be wary of believing anyone who tells you different.

Investigations in Germany are now moving forward at a pace but it will still be some time before any announcements can be made. I'm guessing it will be late Spring of 2021 at the earliest. Peter Mattil is confirmed as a member of the Provisional Creditors Committee and its likely he will also sit on the committee for DC80.

Peter Mattil has advised that he is considering further actions against other parties in Germany, some of which may incur extra costs but will be judged on a strict merit basis. Clearly only his clients will be offered the chance to be involved in those.

Turning to the UK, investor's wishing to join in claims against UK entities in respect of cash unadvised cases are advised to consider contacting The Claims Bureau as soon as possible to discuss their options. Once they start on the legal process it may not be possible to join in our actions afterwards.

BBC Radio 4 broadcast a 40 minute programme on Thursday 26 November which is solely about Dolphin. They broadcast last May as part of the You and Yours programme, this time the broadcast takes up the entire programme. We have been heavily involved in the preparatory work for this and it is the first public step we have taken in bringing Dolphin to the attention of the general public and MP's. We are already working with FSCS (and through them the FCA) on resolution of the Dolphin problem.

Programmes will also be broadcast in Germany (including an interview with me I understand) and we hope this will bring in the interest of the press over there and the public who will be able to judge for themselves whether or not their own Regulatory Authorities have acted diligently.

We hope that through this continued public pressure the cases we are considering will be strengthened.

We have now received 90 donations to the groups fighting fund which is now around £4500 . We are grateful to those that have contributed and to those contemplating doing so.

Mark Hambling

30 October 2020 - Chairman's Update

We have heard from BBL Law who have helped us understand the position regarding claims.

Firstly the 11 December Creditors meeting and subsequent deadline of 25 November are statutory deadlines and not of the Liquidators' choice.

Secondly, there is no bar to submitting a claim after that date (there is normally a 20 euro fee for this but they are going to ask the court to waive this).

They are preparing their webpage and FAQ pages which will explain exactly how to submit your claim if you are not using a german lawyer. It is likely, but not yet decided, that only a small amount of information will be required, contact details, amount owed (interest can be estimated) and company in which you believe your debt is (DC 80 in most cases)

There is no need to panic there is plenty of time to do this.

Mark Hambling

23 October 2020 - Chairman's Update

I should like to announce a number of changes that will be taking place with GPG Creditors Association over the coming weeks.

We have had a serious look at what we do and how. With the developments over in Germany, we have decided that we need to refocus our efforts in areas where we can be of most benefit to creditors. There are not enough of us to be all things to all people.

Events in Germany

As you will be aware form the press announcements there has been a lot of activity in both Bremen and Hanover Courts regarding who is the Administrator for this case.

Without going into detail over the shenanigans the upshot is that Justus von Buchwaldt from a firm called BB Law has been settled on as Preliminary Administrator for As German Property Group GmbH. This appears to be an upstanding firm and a fraction of the size of Goerg the previous administrators. However, it seems that Goerg retain the appointment to the other Dolphin Capital companies that they were appointed to and may well take the remaining companies that have assets. This leaves Dolphin Capital 80 in the hands of von Buchwald who was appointed by Hanover even though that court no longer has jurisdiction over the case. Interestingly, the creditors meeting called for 11 December and the deadline for submitting claims only refers to German Property Group, not Dolphin Capital 80. Those that have sent emails will serve to appraise them of the depth of the issues facing investors and the angst caused by press announcements that are not accompanied with direct information from the Administrator. Note that Goerg did not call any meetings despite being in office for several months whereas the new firm went to the legal gazette almost immediately, certainly before they would realise that records are in disarray.

If nothing else, this episode has convinced me that we need legal representation in Germany.We cannot organise this on a group basis but we will be advising our recommendations once we conclude an agreement for our members of preferential terms. You may be aware that there seems to be plenty of German firms offering their services.... be wary they may not want paying now but will take a high percentage of returns in the liquidation.

More news on this when we have it.

Events in the UK

Many of you may have been waiting for news of the proposed subscription group. After much discussion and research we have shelved this idea permanently. All information, running the Facebook page and the website will remain completely free. All efforts by myself, Raj and Mark B in lobbying the regulatory authorities, dealing with the press to broaden public awareness and generally assist in recovering our money will continue. All we ask is that donations are made to support the effort and cover the expenses of those involved at least. If enough is raised to make some recompense for all the time involved that would also be very welcome.

We will put information on how donations can be made on the website as soon as the account opening for the Association is confirmed.

Finally, we would advise that we are going to recommend The Claims Bureau to deal with (primarily) cash and SSAS claims that Smooth have rejected so that everyone has at least some prospect of recovery in the UK as well.

I will be working closely with lawyers at The Claims Bureau and we are hopeful that lobbying efforts with the SFO, FOS and FSCS and the new All Party Parliamentary Group on Pension Scams coupled with some expert Counsel will bear fruit. We can't promise success but we will give it our best shot.

Mark Hambling

19 August 2020 - Chairman's Update

As many of you are now aware GORG are now advising that they do not expect to be in a position to start discussing what to do with the assets until the beginning of 2021. They are blaming the state of the records and, seemingly, a lack of funds in any German Property Group accounts.

This is a little disappointing as whilst there may be 200 companies to deal with only a quarter of them actually have assets. I see no reason why they couldn't start to consider exit solutions in principle sooner than this. In fact, as soon as they have completed their appointment to the relevant companies and assessed the security situations.

However, there is little we can do other than await their readiness.

In the meantime we have approached the Prosecutor's Office in Hanover and been advised that a file is already open on the German Property Group case. We will be making our representations to them in the near future.

We have been approached by a number of German legal firms with a view to them signing us up as clients for action that may be required in Germany. As yet, we do not see the need for advice as, until the liquidators are ready to consider any action or even to start filing proof of debt claims there seems no advice to take. We will keep this under review, especially as the firms in question either want a % of debt as an upfront fee or a % of recoveries as a fee, or both.

Mark Hambling

02 August 2020 - Liquidation

Further to the filing for the liquidation of DC 80, submitted to the Hanover court on 20th July 2020, there has been a bankruptcy filing for the entire German Property Group (now called AS German Property Group GmbH) and all Special Purpose Vehicles (SPV's) at the Bremen Court on 23 July 2020.

As a retired (UK) Insolvency Practitioner I have undertaken significant research into the German Insolvency provisions to look for similarities and differences with the UK system that I am familiar with. It seems that Germany operates a “one size fits all” type system and there is not a difference between liquidation and administration in terms of a set procedure.

It appears that after the Court filing the insolvency practitioner acts more like an administrator in the way the assets are dealt, looking for maximisation of value for creditors, rather than a straightforward liquidation where a firesale may be held to raise cash as quickly as possible. It appears there is no legal bar to a “reconstruction” of the business whereby the assets are developed for the benefit of creditors. Therefore, there is no need to fear that there will be a zero return for creditors as a matter of course. However, due regard will need to be paid to the question of security as this could have an impact on who is entitled to asset realisation proceeds.

The Directors of German Property Group are now Falk Holtmann and Oleg Borodin (appointed July and April respectively). They replaced Kerim Tekkal who replaced Charles Smethurst back in April 2019. There were also previous Directors of German Property Group who resigned towards the end of 2018.

We are aware that throughout the history of German Property Group it has always been Charles Smethurst pulling the strings and we assume he will be deemed a person of significant control and come under scrutiny.

The Insolvency Practitioner appointed is Dr Gerrit Holzle, of Gorg. I have emailed him directly to advise of the presence of our group. I have spoken to Tim Bayer who says he is a partner of Dr Holzle. He advised that it may take 6-8 weeks before they are appointed to every SPV in the group and consequently it will be sometime before they get to grips with the situation.

He also stated that he believed that there would inevitably be an investigation by the Prosecutor’s office and possibly the police but they did not want this to get in the way of securing the assets.

We will continue to liaise with the Provisional Administrators and would anticipate that they will be contacting all known creditors in due course. This is a preliminary appointment, and should the creditors wish it, an alternative Administrator could be sought.

BACKGROUND TO INSOLVENCY

I am aware that many of you have been alarmed by the appointment of Administrators and some have questioned why this has happened and why the Committee now welcomes this development where previously we had advocated an informal reconstruction as the solution.

There are several reasons why insolvency was deemed necessary that two of the Committee members (myself and Raj Aggarwal ) actively sought to bring this about.

The principal reason was the slow realisation that there was never going to be any choice in the matter because of the intransigence of German Property Group and their reluctance to provide timely meaningful information to enable any consideration of a reconstruction. Nearly six months had been almost utterly wasted by the appointment of CFE by German Property Group who appeared to merely assist in the postponement of any meaningful action.

This, coupled with the fact that any informal reconstruction would take all creditors to agree to it or else it could be challenged by any future liquidator or court action, meant that some sort of court approved solution would be necessary.

In fact, by mid May the Joint International Committee were advised by two sets of German lawyers that a “prepack” insolvency would be the only way forward. However, two international parties did not want this solution.

The totally (in our view and that of some other international groups) unacceptable “offer” by Vicus Group and the appointment of Kirkland and Ellis (who had prepared a draft reconstruction plan whereby the creditors take on all the liabilities) by German Property Group spurred us to take decisive action. The fact that German Property Group must have already had their own insolvency plans well advanced, as they acted before the Hanover Court could even review our filing, merely strengthens our view that this course of action was inevitable.

ONGOING MATTERS

We were always told by CFE how bad insolvency would be for all creditors. However, after taking further legal advice we changed our position. It now remains to be seen whether a consensus of opinion and future action plan can be agreed between the various parties concerned.

We are in discussions with parties who may be interested in either acquiring the assets or developing them on behalf of the creditors. Clearly, until such time as the Administrators are ready to discuss this with them only preliminary work can be done. Mike Boyle (ex German Property Group Client Relations for the UK) is also endeavouring to find a workable solution that will find favour with the various international parties. Hopefully, between us we will find a way to avoid a fire sale.

Our investors who reside in Germany are active in contacting the Authorities and it is our intention to prepare a report of potential wrong doing, or matters for further investigation, to the State prosecutor in Hanover who will in turn liaise with his counterpart in Bremen.

We are liaising with the Financial Services Compensation Scheme (FSCS), The Financial Conduct Authority (FCA) and the Serious Fraud Office (SFO) to examine whether or not there was any wrong doing in the UK or with Dolphin International Group which operated in the UK from Ireland.

Further updates will be provided as and when information is available.

Mark Hambling