Britain’s Got Talent star, 44, faces up to six years in jail for fraud by hiding £3m debts to dupe investors into propping up his debt-ridden property empire
- Dancer Liam Collins starred on BGT as on half of the ‘Faces of Disco’
- Student accommodation firm run by him and cousin David Bone collapsed
- Despite £3m in debts they convinced other to invest in them on buy-to -let properties but used the money to pay off mortgage arrears
- The pair will be sentenced tomorrow at Manchester Crown Court after admitting to fraudulent trading
Liam Collins, 44, could face up to six years in jail when he is sentenced for admitting to fraudulent trading at Manchester Crown Court
A former Britain’s Got Talent star was facing up to six years in jail today over corporate fraud in which he hid debts of £3m to dupe investors into funding his debt ridden property empire.
Dancer Liam Collins, 44, who starred in the ITV show as one half of the ‘Faces of Disco’ duo had gone bust after he and his cousin David Bone ran a firm which offered investment in student accommodation.
But despite their 27 properties in their portfolio being in negative equity as a result of the collapse, the pair set up another similar firm and persuaded investors into giving them up to £1m by falsely claiming investments would be ‘safe’ as they would be used to purchase buy-to-let properties.
They also wrongly claimed they had signed off a business deal worth £20m.
In fact the money was used to pay existing debts on the portfolio and nine unwitting investors lost between £5,000 and £50,000 each. Fraud squad police were called in after Collins and 37-year old Bone were formally declared bankrupt in May 2012 following an investigation by the Financial Standards Authority.
At Manchester Crown Court, Collins, from Springfield Park, Newcastle and Bone from Astley, near Wigan admitted fraudulent trading. Both will be sentenced tomorrow but prosecutors have asked for imprisonment between three and six years.
Collins had been a contestant on the 2009 series and reached the semi final with his dance act with a friend in which they wore masks featuring famous people.
Away from the cameras, Collins and Bone claimed to have launched an audacious bid to buy Michael Jackson’s Neverland estate – claiming they were trying to fork out between £5m and £15m to take control of the ranch in Santa Barbara, California, and they planned to turn it into a shrine dedicated to the singer.
Dancer Liam Collins, 44, starred on ITV’s Britain’s Got Talent show as one half of the ‘Faces of Disco’ duo in 2009. They reached the semi-finals before being knocked out
But in that same year the pair’s firm the CBS group collapsed with £3m debts and mortgage firms appointed receivers to make sure rents from their property portfolio would be used to pay mortgage arrears.
The following year Collins and Bones set up CBP, falsely promising investors ‘high interest returns’ in the purchase, renovation and rental of more student properties. The two men talked of ‘secured bonds’ but investments were transferred into Bones’s bank account to be spent ‘as they wished.’
Julian King prosecuting said: ‘The other way the defendants made people think their money was safe was by telling them that their money was secure because their investment was secured against the value of their 27 properties i.e. these could be sold to pay off any amount owing.
Collins pictured arriving at court today. Enquiries revealed he and Bones received £274,000 from investors while they knew they were trading fraudulently
‘Both defendants knew that the properties had been controlled by receivers and had no equity, and as such presented no realistic security. Yet even after legal advice they received, they were misleading people. The reality was that the assurance that they had 27 properties, which provided security for people tempted by the scheme was really no assurance at all. And, of course, the defendants didn’t tell anyone that fact.’
The court heard the pair claimed to be getting a £20m share of a business deal between Bone’s father and another firm but the deal collapsed.
The Financial Services Authority warned the two men to stop taking cash and Collins wrote to investigators insisting: ‘We will immediately cease to accept new clients and investments.’ But he and Bones continued accepting payments over a six month period.
Inquires revealed £874,000 had been given to Collins and Bones between January 10 and April 11 – of which £274,000 was provided when the two men knew they were trading fraudulently.
At the time the investigation Collins said: ‘We are not conmen and there was never any intention of misleading anyone. I’m incredibly sympathetic to the investors – a lot of them are my own family members – but it’s a two-way relationship; you can be an irresponsible businessman but you can also be an irresponsible investor.
‘Some people think I’m walking around like a millionaire, with money stashed in an offshore account and these people would like me dead. But I’ve lost everything, £3m, 29 houses, my cars my friends, everything.’
‘I’m not a good businessman, I’m a good salesman. I’m very sorry I got into property – we were young and irresponsible and we took risks but were let down by other external sources. We are not criminals.’
But in a statement to police Brendan Galvin, 53, one of the investors ‘As a result of the financial loss this has left me unable to purchase a property of my own. I had a property that I owned and I have always been frugal and wished to invest in a property for my son. I am now not able to offer him money like before. I am still suffering the consequences. I lost £40,000.’
Terence Luxford, 82 who lost £50,000 said: ‘This money was from years of savings, the sale of a business and an inheritance. I never expected to lose the whole of it and I never expected that it was never going to be returned, I was shocked and distressed losing all that money.
‘When I came across their business I went through it with real due diligence and found there were no legitimate concerns. Their website was professionals. What’s happened has impacted me, I currently reside with my lady friend nnd her house is in her name, so if she passes before me I’ll have nowhere to go. I would have to find money to do this.
‘I am 82 and I find that process daunting. I now have just £10,000 in savings. I can no longer afford to do nice things, I can’t afford to go on holiday or buy nice things. There is no chance I will get my savings back to where they were. I am now aware they have had other business ventures that have failed.’
In mitigation for Collins defence counsel Timothy Storrie said: ‘He is somebody who had for himself an ambition to establish a very high standard and he is embarrassed and ashamed about this. They were peer to peer lenders and what Mr Collins and Mr Bone were doing was an audacious enterprise which did not have a genesis. They thought there would be a £20m investment fund and they would get a quarter of the profit of the business to invest. He was trying to outrun the financial problems.
‘There is no evidence of a luxury lifestyle, there was reference in the pre sentence report to him busking on the street.’