Monday, March 23, 2009

Wrekin's ВЈ11m ruby saga - new revelation

The exciting revelation of the weekend for followers of the Wrekin ВЈ11m ruby saga is that The Gem of Tanzania has turned out to be no more than a cricket ball-sized chunk of raw crystal.

Not a mounted and polished piece of jewellery at all.

On top of that there are doubts over the purple rock’s valuation certificate – it could  have been written on a Asprey & Garrard letterhead that was being “used for purposes for which it was never intended” by a valuer with a history of supplying over-optimistic valuations.

The Financial Times dubs The Gem of Tanzania episode as “the strangest accounting controversy of recent times”.

Wrekin’s elusive precious stone finally turned up on Friday afternoon last week when it was delivered into the hands of Ernst & Young, administrators for Wrekin Construction which is now in administration but is expected to end up in liquidation.


Wrekins ВЈ11m ruby saga - new revelation


When David Unwin arrived two years ago and “invested £11m” into Wrekin the group was on its knees after a racking up losses while run by Simon Frain (chairman) and John Worthington (chief executive).

Wrekin needed an investment of cash but what it got was a ruby valued at ВЈ11m. However that valuation alone turned the assets of Wrekin from negative to positive in a single swoop and that was enough to instil confidence among Wrekin’s clients and suppliers.

That sufficed to keep Wrekin’s wheels rolling until the RBS bank got cold feet on providing the contractor with debt and pulled the plug.

Derek Miller, the solicitor of David Unwin, has now stepped forward with details of The Gem of Tanzania.

“Miller had the job of forwarding the stone to Ernst & Young, allowing him to counter press speculation that it did not exist,” says the FT story.

“However, when he began checking out the 2004 valuation certificate, Miller said he was dismayed to find that the competence of the valuer was disputed by a referee, a former Asprey & Garrard employee, Brian Dunn.

“Dunn told the FT that a reference he provided on Asprey & Garrard letterhead вЂwas used for purposes for which it was never intended’ and that the valuer, who is now retired, had a history of supplying over-optimistic valuations.”

Unwin’s solicitor thinks Unwin believed he had bought a ruby worth £11m once cut into smaller gems.

Miller provided photos of The Gem of Tanzania.

Unwin’s receipt showing that £11m was actually spent is yet to surface.

Wrekin ruby saga - valuation jumped from £300,000 to £11m
Wrekin ruby saga - Tanzania gem now on eBay