Alan has paid a hell of a price. London is his new home. He is trying to keep his head down and I would encourage him to do so.
Bond’s friend, Robert Quinn, September 20001
In August 2000, fifty years after he arrived on Australian soil as a ten-pound Pom, Alan Bond returned to England with the intention of making London his home. He is now living with Diana Bliss in a $3 million penthouse opposite Kensington Palace and doing what he knows best—making money in property.
The apartment is in a five-storey mansion block that was bought for $10 million in early 2000 by a British Virgin Islands company called Bonaparte Investments. In April 2001 it was being offered for sale as five separate units for a total of $12.7 million. And you win no prizes for guessing who was behind it. According to an investigation by Melbourne’s Sunday Herald Sun:
A real estate agent involved in the potential sale of the Kensington building confirmed this week that Alan Bond was directly involved.2
But property dealing is not Alan’s sole money-making venture. In mid-2000 he bought the UK rights to an Australian money-lending business called ChequEXchange, which he plans to operate in Britain under the name ‘Money Centre’. If all goes to plan, Alan Bond, the world-class debtor, will soon be on the other end of the credit equation, with Money Centres popping up all over Britain, offering short-term loans— average £250—to people who can’t get money elsewhere.
The building housing Bond’s new corporate headquarters, which he shares with top-drawer names like Christian Dior and Moet & Chandon, is in swish Belgravia Crescent, roughly halfway between Buckingham Palace and Harrods. Money Centre’s chairman is an old friend called Robert Quinn, who kicked the tin so generously in 1991 by wiring $200,000 from a Swiss bank account to pay Alan’s legal fees.
Quinn told London’s Sunday Telegraph late last year that Alan’s new mini-bank business was owned by a Bond family trust.3 And he assured readers, in the time-honoured formula, that the ex-bankrupt entrepreneur was merely acting as a consultant, helping them find suitable sites for their new mini-bank branches. According to Quinn, the rates of interest will be high—for which read exorbitant.
Back in Australia, where ChequEXchange first set up its shingle in 1999, ‘payday lending’ has been one of the fastest-growing and most controversial industries. By mid-2000, there were 80 outlets operating under three rival brand names, with projections that the number would grow to 400 within a year. However, the business had attracted violent criticism from the people whose job it is to protect Australian consumers. In the words of the New South Wales Fair Trading Minister, John Watkins, to state parliament, payday lenders were ‘nothing but loan sharks playing on people desperate for cash’. Or to quote the verdict of his Queensland counterpart, Judy Spence: ‘They’re manipulative, exploitative and unfortunately preying on the vulnerable and weak in our society’.
It seemed apt that Bond, who liked to present himself as the battler’s friend, should be making his comeback in such a controversial business.
A report by the Queensland Fair Trading Department in August 2000 noted the example of one couple who had borrowed $50 for two weeks in July 1999 and then rolled it over several times, to find that within ten months their debt had blown out to $980. By then, they were paying fees of $196 a fortnight just to stop the debt getting bigger, and were in a trap from which they could not escape.4
According to the Queensland report, the three main players in the industry, of which ChequEXchange was the biggest, were effectively charging interest rates of between 235 per cent and 1,300 per cent per annum. At the top end of the scale, this was seventy times more expensive than the average credit card, and thirty times higher than the maximum rate of interest permitted by Australia’s consumer credit laws.
Whether Bond’s venture in the UK will adopt similar practices remains to be seen. By mid-2001, he had still not opened his first branch and his plans were on hold. Having paid a deposit of $250,000 to secure the UK rights, he had refused to pay the balance that he owed on the $1.05 million deal. Finally, in June, he settled for a fraction of the $800,000 still owing, and ChequExchange confirmed that his Money Centres would go ahead without them.