Paying over the odds

There was an interesting development in the Pembroke Dock grants saga at last week’s full council when cabinet member Bob Kilmister answered Cllr Jacob Williams’ question on the repayments received from property developer Cathal McCosker and companies under his control.

To fully understand all this you have to go back to April 2014 when PCC presented Dyfed-Powys Police with a fat dossier detailing irregularities in £60,000-worth of grant payments for projects carried out by Mr McCosker at 10 Meyrick Street (10MS) and 29 Dimond Street (29DS) Pembroke Dock.

On 9 April 2014, two days after the dossier was handed to the police, PCC’s European Officer Gwyn Evans wrote to Mr Cathal McCosker asking for copies of bank statements as proof that the amount of grant certified had been paid to the builder as required by the grant scheme procedure manual.

When I inspected the files on various McCosker projects all that could be found were photocopies of cheque book stubs. When this was raised with the Wales European Funding Office (WEFO) it declared this evidence to be inadequate.

Clearly, PCC’s European Office shouldn’t have signed off these grants without first obtaining this evidence of defraymeny and this late intervention was an attempt to close the stable door just as the horse was disappearing over a nearby hill.

But Mr McCosker refused to play ball and his reply dated 10 April gave several less than compelling reasons why he was unwilling accede to this request for sight of his bank statements.

However, he did offer to repay within one year all the £184,000 he has received in grants up to that date:

“Frankly I can do without this in my life at the moment. In your letter you state “If we cannot obtain this evidence WEFO may seek to recover the grant paid”. In the circumstances I have looked at the amount of grant that was paid in relation to the four properties that seem to be in dispute. The grant that I have received totals £184,000 or thereabouts. If it would resolve all this Council in-fighting and all this adverse publicity that is being generated against me, then I will repay this grant. It is by far the simplest and most appropriate process. This will release me from the obligations, I presume, that the grants imposed relating to the sale of the properties as the Council no longer will have any hold or interest in them.

As a consequence if you can confirm this will be an end to all this, I now propose to make repayment. I will not be able to make repayment immediately but can offer an upfront payment to repay the grant on 10 Meyrick Street and I will repay the rest within a reasonable time frame. I believe I can probably repay all grants on the said four properties within twelve months.”

I also understand that Mr McCosker agreed to forgo a grant of some £125,000 on a fifth project known as 50 Dimond Street (owned by McCosker-controlled company 50 Dimond Street Ltd) then nearing completion.

This together with the £184,000 accounts for the £309,000 that PCC was forced to return to Wales European Funding Office (WEFO) in the early summer of 2014.

Obviously, with the dossier already in the hands of the police, PCC was in no position to go along with McCosker’s suggestion that repayment would lead “to the end of all this” which some might interpret as an attempt to brush the whole thing under the carpet.

Nevertheless, despite the lack of any promise to turn a blind eye, Mr McCosker has continued to make payments and according to the answers given to Cllr Jacob Williams’ question, the current situation is as follows:

10 Meyrick Street and 29 Dimond Street
Owner: Cathal McCosker
Grant paid: £124,926.71
Repayments received to date: £98,500
Amount outstanding: £26,426.71

27 Dimond Street
Owner: 27 Dimond Street Ltd.
Grant received: £36,884.43
Repayments received to date: £0.00
Amount outstanding: £36,884.43

25 Dimond Street
Owner: The Old Butchers Dimond Street Ltd.
Grant paid: £27,413.12
Repayments received to date:

23.02.18** = £10,000

26.02.18** = £17,413.12

Amount outstanding = £0.00

**Can it be coincidence that Jacob’s question was submitted on 21 February?

This all means that Mr McCosker has repaid £125,913 of the £184,000 he promised to repay back in 2014.

However, the situation is rather more complicated than that because the dossier handed to the police identified just £60,000 in irregular payments on two projects: 10 Meyrick Street and 29 Dimond Street (then Paul Sartori charity shop) both owned by Mr McCosker personally.

So, rather than allow PCC and WEFO to inspect his bank statements, Mr McCosker has agreed to hand over £184,000 (£309,000 if you add on the foregone grant for 50 Dimond Street) though only £60,000 has been called into question.

£250,000 to avoid showing his bank statements to PCC seems rather a high price to pay.

Can I be the only person to find that rather odd?

Odder still is that 25, 27 and 50 Dimond Street are/were all owned by limited companies controlled by Mr Cathal McCosker.

The reason for this arrangement is thought to be the rule that no single applicant could be awarded grants exceeding £200,000 in value in any three year period.

The value of the grants originally awarded to 10 Meyrick St (10MS) and 29 Dimond St (29DS) was £152,000 and the addition of any one of the other three grants would have breached the £200,000 limit. See Joining the dots.

The dossier provided to the police on 7 April 2014 detailed irregularities (flaws in the tender process, payments for work that was ineligible for grant aid or simply not done) amounting to some £60,000 in respect of 10MS and 29DS the two buildings owned by Mr McCosker, personally.

None of the three projects in the name of the McCosker companies (25, 27 and 50 Dimond Street) were involved in the complaint to the police, so their separate legal personalities would shield grant funding they had received from any repayment conditions attached to 10 Meyrick Street and 29 Dimond Street.

That being the case you have to wonder why he is paying back/forgoing £250,000 to which he appears to be perfectly entitled.

Generous, or what?