Passive Investments Liquidation | Further Money Gym Statement

Last week the news broke about Passive Investments going into liquidation and Greg Ballard and Andy Shaw facing bankruptcy proceedings and one of the most difficult phone calls I had to make was the one telling my much-touring singing sister, Heather, about the news.   In my journey as a wealth coach, and the subsequent journey of creating and building The Money Gym, I don’t think I can remember such a difficult and horrid week.

As you know, I regard Andy and Greg as friends of mine, and they helped me so much, both practically and emotionally, when I was going through the difficult time with trying to sell the hotel, after the planning permission for change of use was refused.   I really could not believe that they had done anything wrong.

While all of my friends and family are grownups and able to do their own due diligence and make their own decisions, I still feel responsible that I have introduced them – along with my treasured clients – to something that I really believed at the time was good, even great, but now turns out not to be.

As more and more information comes to light about Passive Investments and the way they have treated some people, I am starting to feel very bad indeed about having promoted them, but I can only say that I (and then the Money Gym) did that in good faith, and the moment we started to suspect that they might not be delivering on the customer service in the way we would have liked, based on Judith’s personal experience as a client, we ceased to do so.

We were paid commission on referrals by Passive Investments. However, I can say, hand on heart, we never introduced Passive to anyone that we felt would not benefit from their service, and both Judith and I often actively talked some people out of it.   If an investment opportunity does not feel right in every way to our clients, we discourage them from proceeding with it.   We can honestly say that we have never introduced anything to our clients for the purposes of securing our introduction fee only; that is a bonus only.

Judith has educated me, over the weekend, about how Passive should have handled the client fees and how it seems they may not have complied with proper accounting procedures.

With hindsight, the statement we released last week was written hastily in response to the discussions on our private forum and comments on the blog and came from our hearts, but perhaps we should have waited for a few days before issuing it while the full story filtered back to us.

My position has always been that I (and The Money Gym) would only promote something that either I, or someone very close to me, had invested our own money in and were happy with.  The service that Passive offered was so attractive that nearly all my friends and family jumped on board, followed by a lot of our clients and subscribers.  However, in light of the developments last week, I feel that The Money Gym will be reviewing it’s stance on introducing anyone or anything at all, let alone quite so wholeheartedly, in the future.

I apologise unreservedly for my part in bringing the services of Passive Investments to the attention of so many people.

Nicola Cairncross

Note:  James Tickell, director of Portland Business & Financial Solutions, the insolvency practice chosen to disband the Passive Investments empire, says the matrix of firms will formally enter liquidation on 11 December.

Contact:  London Office, 43 Pall Mall, London, SW1Y 5JG, Tel: 020 7925 2651 / Fax: 020 7925 2652 / Office email: post@portbfs.co.uk

Why I Have Sent Tudor Equity A Cheque For £2.5k With A Smile On My Face by Clare Hanbury

Money Gym Subscriber Clare Hanbury-Leu says: The relationship with Passive Investments was built on trust. I have trusted them to find the right properties – to renovate them to a high standard – to rent them out as quick as they can – to advise on the best mortgage deal – to re-mortgage and turn things around as soon as they can etc.

Most of us must be happy to accept risk to put so much trust into the hands of people we don’t know well. My friends, my financial adviser, my partner all felt nervous of the arrangement and advised against it but I pursued it – uncharacteristically ignoring their advice. My instinct felt strong on this one.

I have been involved with Passive Investments for 3 years and have two properties. The rental on one of these was a little slow in coming and the turnaround on the first mortgage again a little slow. I had one property fall through and lost a bit of money on legal costs and survey etc. All this said, I have been delighted with the results of the investments to date and delighted with every contact I have had with the company. I have felt totally supported by them. I like having them in my life. Every glitch, every query has been dealt with quickly, politely, humorously.  I have been happy to talk to two potential clients and chat through my experiences with them.

I have had some contact with Greg in the last few months and found him open and straightforward. He is an ideal business partner. Even prior to my contact with him there was no doubt in my mind that these are very tough times for the company with its peculiar business model that clients pay when we have done well and not until then! I am staggered that he has stuck at it as long as he has with no salary. I know he has worked for the future of his own properties (which is good thing) but he has also worked free for me too!

When the letter came though last week, the trust I had placed in them suddenly felt foolish. However after a few minutes indulging in panic…most of what I felt was what a WASTE of the talent and expertise that is this team. I felt upset that I would not complete the portfolio. I felt nervous about having to deal with the properties on my own and I felt frustrated to have to do so when they have a good system in place. I have a property in London too which I manage myself and would much rather it was in Passive’s care! Then I read that Steve wanted to keep things going with the team there and I was keen to know how I could help.

So…..there is this 2.5k (which is a LOAN) to help Tudor Equity capitalise – this is money that the very same advisers, partners friends etc will describe as throwing good money after bad – but I don’t think so. From a numbers point of view…Because the 15K back payment /property has been reduced to 10K this means that by the end of completing the portfolio of 5 properties, there will be a SAVING to me of 25K from the original agreement AND I’ll get the 2.5 loan back.

Hmnnn why is this a difficult one to agree to? I guess that it’s difficult because of trust. Do I trust them again? The way I see it is that they have ALREADY done so much for me re: my properties that they have ‘earned’ this AND if the team don’t think they can make a go of it because there are not enough of us signed up – we’ll get the money back anyway…and if they DO think they can make a go of it – well I am willing to give them an opportunity to do so.

My cheque is on its way to them with a smile on my face. I really want to help keep this business going and I am grateful to them for giving us a chance. I have not yet spoken to anyone outside of Passive and I have not looked on the internet to read what is being said so my words are unaffected by others’ opinions.

I don’t see any point in NOT supporting the team now. I feel the market is not only stabilising but strengthening – I think we all know this and what we also know is that we have a dedicated team and they will be even more so if this can go ahead. I really hope there are enough of us to give them a chance to navigate a path to creating a robust business again. I’m sure they can do it. The banks won’t help but I will.

Clare Hanbury B.Ed (Cambridge) MSc (London) MA (London)
International Development Consultant ClareHanbury.com

Passive Investments In Liquidation | The Money Gym

Read The Latest Money Gym Statement Here>>>>

Nicola says: Following the shocking news that Passive Investments have gone into liquidation, and that Andy Shaw and Greg Ballard are being made bankrupt by one of their larger creditors, many people are asking us to comment, both on the blog and in our private google group.

When I first met Greg and Andy, back in 2004 I think it was, they struck me as two highly intelligent, funny, energetic, successful guys, who had been in traditional business before, who thought very differently to many people and who had created a FANTASTIC model for investing in property. They were also helping their friends and family invest in the same way, on a fairly small scale, as well as building their own portfolios which numbered about 150 properties in those days.

I immediately knew that our Money Gym clients would love to meet them and hear about this method of investing in property, getting your money back out and going again, as the need to leave money in a property was frustrating many of our clients. We organised an Open Day at my hotel, The Acacia, and many of the clients who were there wanted Greg & Andy to do it for them, like they were doing for their nearest and dearest. Greg and Andy put together an offering, and I spread the word into the Money Gym group of clients and subscribers.

I introduced them to Gill Fielding, my first wealth mentor, who immediately invested with them, ditto Maria Davies. Gill then started presenting this opportunity for them. When Gill could no longer present, Maria Davies took over for a while.

Everyone loved the concept, especially busy professionals and people who wanted to invest in property but didn’t have the first clue about how to go about it. Most people really took to Greg and Andy too, as they shared their knowledge freely, helping many, many people make money along the way. I particularly remember one lunch where they helped a Money Gym client to negotiate a purchase, making him an extra £80,000 along the way. They then took him under their wing and mentored him for a while in his own property deals.

Pretty soon, they were so swamped with people wanting them to invest for them, that they had to create a company to handle the demand. Passive Investments was born.

We are also aware that they then developed a “private investor” scheme whereby people with money sitting idle in a low interest bank account lent the money to Greg and Andy personally for bigger property projects, and because I was not one of those people, I didn’t find out any further details and they never sought a public platform for that opportunity though the Money Gym.

My sister Sarah and brother-in-law Nick invested, my sister Heather invested, Steve Watson and I both bought a “place” each too. I would have happily bought more “places” if I could. The company still owe us for some of the second “place” so my family and I are all out of pocket as well as those of our clients who chose to invest alongside us.

One ray of hope is that those of our clients and family who have properties may make up the monies they have lost (by having paid a fee for a service that now won’t be delivered) AND may ultimately end up better off, due to now not having to pay Passive the agreed “back end” fee on the eventual refinancing of their properties.

Judith Morgan, ex-accountant, Money Gym client and now our business partner, invested the entirety of her inheritance from her Mother into her two “places”. This should have meant ten properties in the fullness of time but she only has three. Her portfolio could not be grown once it became impossible to achieve mortgages or re-finance.

I have heard some horrible stories going around about things that Greg and Andy are supposed to have said and done and while I have no personal knowledge of those things, I’m working on the “innocent ‘till proven guilty” theory. I have always liked and respected Andy and Greg, and I feel sure that most of the rumours are unfounded.

Only yesterday Andy’s website was apparently hacked into, allegedly by someone known to the company, and a personal message to members and investors was changed beyond all recognition to cast the worst possible light on Andy. Here is a link to Andy’s correct personal statement.   Remember to click on the Free User button and then the blue Download button.

We have also been re-educating our clients during the credit crunch to take a more active role in managing ALL their investments, including this one which was originally intended to be passive.  You might want to read about one of our clients (who is not alone by any means) who feels that she will go forward with Tudor Equity, the company that some of the management team is putting together to take the portfolios forward.

Feel free to comment on the blog here but be aware that we reserve the right not to publish any comments that are potentially libellous or are simple repeating content from other people’s blogs or emails.

Later Note: James Tickell, director of Portland Business & Financial Solutions, the insolvency practice chosen to disband the Passive Investments empire, says the matrix of firms will formally enter liquidation on 11 December.

Contact:  London Office, 43 Pall Mall, London, SW1Y 5JG, Tel: 020 7925 2651 / Fax: 020 7925 2652 / Office email: post@portbfs.co.uk