Small Business Case studies

Small Business Case studies

Some businesses affected:

These are a few of the businesses affected. Obviously, companies do not want their story in the public domain as it could easily cause their customers to think twice about dealing with them. The people in the following cases are real. They are NOT investors playing the stock market or operating tax avoidance schemes. They are business people and UK tax payers with UK registered small companies who had deposited money in KSFIOM because it offered competitive interest rates and easy access. The future for these companies is, at best, looking very difficult.

Company 1, based in Northamptonshire, is in the Financial Services sector and was doing well. They planned to expand by buying a competitor and negotiations were almost complete. In order to finance the deal, the owner had remortgaged his home and placed all his reserves in an account in KSFIOM. This amounted to 420,000 GBP and was there for just 6 weeks before the bank collapsed. The company employs 9 people and has a turnover of 900,000 GBP.

Company 2, based in Leicester, exports 50% of its products to the USA and Japan. It has a turnover of around 750,000 GBP. Wishing to keep the money earned from these exports in dollars, as paid by customers, and be able to administer the account via the internet without paying the set-up and monthly charges which its high street bank were going to charge, it placed USD 226,000 in an account with KSFIOM at the end of September. When the bank crashed it still had 113,000 USD locked in the account.

Company 3, based in Essex, is an IT contractor. The contracting business can have long periods of inactivity between contracts and so the owner had prudently saved for the rainy days. His savings and money for corporation tax and VAT, amounting to 100,000 GBP, were placed in an account with KSFIOM for safe keeping and to earn some interest until it was needed.

Company 4, based in Crawley, is in the Leisure Industry and employs three people. They turn over around 500,000 GBP and most of their income is in USD. They have a total of 566,000 USD tied up in KSFIOM in a business and a personal account. Their retirement fund and their day to day business funds are locked making it very difficult to continue operating.

Business start-up opportunity in IT consulting for SMEs based in Bristol and Madrid is now unlikely to happen as the entrepreneur concerned placed all his start-up capital in a personal savings account with KSFIOM. This amounted to 70,000 GBP of hard earned, tax paid money.

Company 5, registered in the UK but operating worldwide in the project management/engineering/construction sector, placed 15,000 euro in a business account in KSFIOM and the owners’ retirement fund from 30 years of working abroad of 140,000 GBP in KSFIOM. They are still operating but, not being domiciled in the UK, are finding it very hard to open a bank account in the UK because of bank policy relating to money laundering.


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