Park First investors sue after collapse of Gatwick carpark scheme

Investors who put their savings into a Gatwick airport car parking investment scheme are suing the businessman behind it for fraud after its collapse.

The largely elderly investors, some of whom lost money in the collapse of London Capital & Finance, were persuaded to buy leases on parking spaces at Gatwick and Glasgow airports. They were told by Park First they would receive high returns from the parking fees paid by the airports’ customers.

They claim they were told it was a “low risk” investment but, in fact, it failed to pay what it promised and several of the complex web of companies behind it collapsed into administration.

Now, they are suing Park First, its founder Toby Whittaker and others, claiming fraudulent misrepresentation among other allegations. They are set to seek £6 million in compensation.

The action claims the company drastically overvalued the leases at £25,000 and £37,500 for Glasgow and Gatwick respectively.

A key part of the scheme was that the Park companies would sub-lease the plots back from the investors, offering a guaranteed return of 8%. The company said “projected returns” would rise to 10% in years three and four and 12% in the two following years.

In fact, the claim says, the sub-leases only lasted for two years, after which Park broke them and failed to provide subsequent services, leaving the plots impossible to sell. The investors also claim Whittaker’s companies misled them that they would easily be able to sell their spaces if they wanted to. There was no secondary market to buy them, which Whittaker knew, the case alleges.

The claim says some of the car parks in Glasgow were fenced off, making it impossible for them to return the kinds of profits being promised.

Law firm Trainer Shepherd Phillips Melin Haynes, based in Soho, is acting for the investors.

Park executive Ruth Almond, also named in the action, said: “The action will continue to be defended. We believe investors would be better served by pursuing options set out by the administrators.”

Park is being administered by Smith & Williamson, the same firm administering LCF. Investors bought into Park directly or through their self-invested personal pension.