Investors in collapsed car leasing provider Buy2LetCars are unlikely to get their money back as the company was insolvent for years, the City regulator has warned.
According to The Times, it has now emerged that Buy2LetCars has assets of £14.4m, but liabilities to investors of £34m over the next three years.
The firm would need to raise £6m this year and then £14m in each of the next two years to meet its liabilities.
This means “it is unlikely to be capable of meeting its debts as they fall due”, the regulator reportedly said, adding that Buy2Let Cars made losses of £10.5m in the past three years.
The City watchdog was warned about Buy2Let Cars two years ago by campaigners, according to The Times report.
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Buy2LetCars enabled investors to fund car leasing agreements and advertised interest rates of up to 11 per cent.
RSM has been appointed as administrators over the collapsed companies.
Buy2LetCars has been contacted for comment.