A statement from Ford’s spokesman Media House chairman Jack Irvine says the regulator forced Keydata into administration on the grounds of a £5m tax bill but this was a “red herring” and its demise was due to the FSA’s draconian intervention.
He says there was no bill but a “contingent liability” to HMRC if it was accepted that there had been breaches of the Isa regulations of plans which had not been listed on a relevant exchange at least five years before their maturity.
He says: “There was no £5m tax bill but if there had been, Keydata had the cash and access additional financial resources that would have been more than sufficient to pay such a bill. After all, at the time, Keydata was worth more than £60m and had no significant third party debt. What made the FSA think that such a company could not meet a £5m tax bill if it had to?”
Ford’s spokesman insists the firm was “well down the track” to reaching an agreement with HMRC about utilising the “simplified voiding procedure” which would have dealt with Isa issues but the FSA intervened.
He says: “For reasons best known to it, and as yet unexplained, the FSA considered it appropriate to intervene and prevent Keydata reaching a ‘simplified voiding’ agreement with HMRC that would have dealt with the Isa issues once and for all without any cost or distress to investors.
“The actual cause of Keydata’s insolvency was the FSA’s draconian action in removing all of Keydata’s regulatory permissions at a stroke before Keydata management had been given any opportunity to respond to the preliminary findings of the FSA’s investigation enforcement team.”
The FSA refutes Ford’s allegations concerning its actions regarding Keydata.
A spokeswoman says: “Keydata was placed into administration last June by the High Court. At no point did the management of Keydata oppose this application.
“HMRC established that several Keydata products were not eligible for Isa status which gave rise to a significant tax liability which Keydata had no means to pay. This liability put its investors at significant risk. The FSA is continuing to investigate this issue. In addition, the Serious Fraud Office’s investigation into Keydata continues.”