A council is offering interest free loans of up to £50,000 each to gypsies and other nomads to buy land to pitch their homes.

Mendip Council, Somerset, is urging landowners to come forward to sell gypsies and other travelling groups plots for permanent homes.

The council wants to buy the land with the groups with a Community Land Trust (CLT) – a method of setting up an interest free ‘mortgage’ on the land for the travellers.

Lynden Clark, Mendip District Council’s housing project officer, said: “The traditional way of providing sites is for local council’s to build large scale sites which are owned and managed by the council and pitches are rented out to families. These sites often carry a negative stereotype and are expensive to build and maintain.

“CLT’s will offer long term security for residents as well as stability. The scheme offers a more cost effective way for the council to provide sites.”

Legislation requires all council’s to assess the shortfall of pitches in their areas. Mendip District Council needs to provide 57 residential pitches.

Councillor Nigel Woollcombe-Adams, the council’s portfolio holder for the built environment, said: “The targets for Mendip compared to other districts are particularly challenging, but we have to recognise that  doing nothing means the council ignores its obligations and the pressures on our legal, enforcement and housing services will continue.

“Like other councils across the country which deal with homelessness and unauthorised gypsy and traveller sites, these issues continue to create financial pressures and it is important that we take some steps in working towards a positive outcome.

“The Community Land Trust gives us a positive way forward in meeting our pitch requirement and offer excellent value for money, whilst supporting the needs of the travelling community.”

Land banking companies that cheated property investors out of £1.8 million with false promises about the development potential of land were wound up in the High Court today.

The five companies lied to investors when claiming could provide them with land that could deliver good investment returns and sold some investors land they had no right to sell.

The companies involved were Pemberton International Limited; Eldon International Limited; Willow International Limited; Allied Investment Management Limited and Abacus Investment Management (London) Limited.

The companies had a registered office at 50 Ellison Road, London SW16 except Abacus Investment Management that had a registered office at Rutland House, 90 Baxter Avenue, Southend-on-Sea.

Commenting on the case Ian Lucas, Minister for Business said:  “This action sends a clear message to those businesses who set out to cheat members of the public and investors, you will be thoroughly investigated and when necessary closed down.   This case also highlights the need to remind potential investors to be wary of any land banking, or other scheme, that promises huge profits for little outlay.”

The companies marketed investment plots in Thorndon, Suffolk; Halifax, West Yorkshire; Worplesdon, Surrey; and Folkestone and Bromley in Kent.

More than 500 plots of land were sold to investors generating nearly £1.8million for the companies before they were forced to close down.

None of the sites had any prospect of planning permission for residential development.

The grounds for winding up the companies were that they made misleading and unfounded statements in marketing the plots of land to the public; sold land on two sites (Worplesdon and Thorndon) that they had no right to sell and that over a third of company receipts were found to have gone to those involved in the running the business, namely :

• £372,226 to Omar Eshpari

• £152,042 to Stefan Mitchell

• £184,786 to Dean Straker

• £34,795 to Jose Emilio Gongora

In court, Registrar Derrett said:  “This is a serious case where considerable amounts of money have been obtained from the public. I am satisfied that the evidence, based on a very full report, substantiates all of the allegations. The evidence shows diversion of funds and the intermingling of funds by the companies that can’t be unravelled. I am satisfied that Mr White and Mr Eshpari have demonstrated complete lack of co-operation and that this is very obviously a case where winding up orders should be made.”

The investigation also found that the companies had failed to keep proper accounting records; had failed to comply with Companies Act requirements; failed to co-operate fully with the investigation and operated with a serious lack of transparency as to who controlled the companies and with a lack of clarity regarding the structure and roles of the companies.

The companies initially opposed the winding up action but were not present or represented at the full hearing of the petitions on March 31, 2010 and they were all ordered into liquidation on grounds of public interest.

A property company is offering to reimburse investors who bought land for housing development on a green belt site where building is banned.

Commercials fronted by former England captain Bryan Robson and England international Steve McMahon promoted a 250% return on investment in three years when shown on TV in the Far East in 2006.

But investors did not realise their plots on the grandly named Concorde Village near Heathrow Airport were in fact on a disused gravel pit formerly called Feltham Lower Lakes (Pictured – Google Maps). The site has no planning permission for housing.

Steve McMahon is commercial director of the group, while Bryan Robson confirms he was paid for the TV ad but has no other connection with the company and is unaware of any complaints from investors.

Profitable Group is said to have made £47 million from the deal by dividing the site in to small plots. The site was bought for £3.2 million. The subdivided plots were sold at £8,000 to £13,000 each.

In reality, these plots can only realise value in two ways – through land values rising or uplift – which is an intervention that causes the price to rise, for instance, obtaining planning permission would give the land uplift.

Unfortunately Hounslow Council has issued a statement saying green belt land can only be developed for special reasons and that the council sees no special reasons in relation to Concorde Village.

Profitable Group owns some similar UK land that has also been split in to small plots and sold in the same way as Concorde Village.

A full list of their developments, including Concorde Village, is on their web site

A spokesman for Profitable Group said advertising for the 250% return had long since been withdrawn and that the company would refund investors, but no one with a right to sell has approached them.

The Land Registry issued guidance to investors about Land Banking schemes in April 2008.

The guidance said the process was usually run by a company buying land in the green belt without planning permission that subdivided the area in to plots that were then sold on the basis of a profit return.

The Land Registry says many of these schemes mislead investors in to believing planning permission may be granted, when in fact because the land is in the green belt, the likelihood is extremely unlikely.