Amber Bridging Limited (In Administration) & Anor v Market Financial Solutions Limited

Introduction

1. The application before the court seeks the appointment of administrators over a company known as Market Financial Solutions Ltd (“MFS”). The application was issued in unusual circumstances.

2. On Thursday, 19 February, Mr Paresh Raja, the only remaining director of MFS, filed an application to appoint Stephen Katz of BTG Begbies Traynor (London) LLP and Nimish Patel of Coots & Boots Limited, as joint administrators. The following Monday, 23 February the application was withdrawn. On Tuesday 24 February Amber Bridging Limited and Zircon Bridging Limited (the “Applicants”) issued a creditor application to appoint Simon Appell, Benjamin Browne and Alastair Beveridge of AlixPartners UK LLP (“AlixPartners”) as administrators (the “Application”).

3. A certificate of urgency accompanied the Application stating that the business is urgent and cannot await a hearing to be listed in due turn because of the reasons set out in paragraphs 51-54 of the statement of Simon Appell.

4. In his statement Mr Appell said that the situation with MFS had been developing extremely quickly in the recent days and hours. The crux of the reasons for urgency given by Mr Appell are as follows: “a. …it is evident from the Company’s latest audited accounts that the Company is balance sheet insolvent. The Company has no realistic prospect of meeting its liabilities in full, and there is an obvious and pressing need for an office‑holder to take control in order to protect the interests of creditors as a whole. b. The Applicants have very substantial claims against the Company. The significant size of these claims, relative to the Company’s asset base, means that every day of delay increases the risk of value being lost to the general body of creditors, whether through dissipation of assets, incurring further liabilities, or transactions entered into without proper regard to creditors’ interests. An administrator is needed urgently to stabilise the position and prevent further prejudice. c. I am aware that several other key creditors have material exposures to the Company and are themselves becoming increasingly concerned about the deterioration in the Company’s financial position. d. All of this is set against a background of serious and unresolved questions regarding the management and governance of the Company and the wider MFS Group. There are credible concerns about mismanagement and the way in which key decisions of the Company and/or the MFS Group have been taken. Creditors require access to information and documents in order to understand their position, but that information has not been provided to date. An administrator is urgently required to secure and review those materials, investigate the conduct of management, and take steps to recover any assets or unwind any transactions which may be challengeable. e. Further, the Applicants concerns have been heightened by observations by the English Court in previous (unrelated) proceedings concerning Mr. Raja’s conduct and character acting in his capacity as the sole director and CEO of the Company. f. The above developments underline the immediacy of the crisis and the need for a prompt, court‑sanctioned appointment. There is a clear risk that Mr. Raja may seek to shape the process to his own advantage, including by selecting office‑holders who he has sought to form relationships with. It is therefore essential that administrators are appointed by the Court now, to ensure that the administration is conducted independently, transparently, and in the best interests of the general body of creditors.”

5. Mr Appell goes on to explain why AlixPartners are best placed to be appointed. I shall turn to this shortly.

6. The Applicants wisely took the opportunity to mention the Application at the end of the ICC Interim Applications List on 24 February. It was explained by Mr Bayfield KC that the Applicants had not had an opportunity to serve the Application on the Company or any creditor. Given the urgency I agreed to hear the Application the next day, which had been allocated for other court business but was capable of being changed.

7. Notification of the Application was successful since various creditors have written to the court about the proposed appointment and Mr Patel (plus a group of unsecured creditors) oppose the appointment of AlixPartners.

8. By a letter dated 24 February 2026 Stephen Katz of BTG Begbies Traynor wrote: “On 19 February 2026, Mr Raja filed an application, on behalf of the Company, seeking to appoint Mr Patel and I as its joint administrators under Paragraph 12(1)(b) of Schedule B1, which was originally listed to be heard on 6 March 2026. Owing to the urgency of the matter and concerns expressed by a number of stakeholders, with whom we had engaged at short notice, and to avoid a potentially protracted period of uncertainty, this application was withdrawn and it was proposed that the Company would instead immediately pursue the out-of-court appointment of Mr Patel and I, for expedience…it came to my attention that the Applicants had filed the instant Application, purporting to be creditors of the Company, in order to, essentially, block the proposed out-of-court appointment and have managed to secure an immediate hearing…”

9. He appears to claim foul play and refutes any assertion that he had a prior relationship with Mr Raja at the time of his appointment as administrator of 14 companies connected with MFS and Mr Raja. Further background to MFS

10. I shall take the relevant background to MFS and its associated companies from the first witness statement of Mr Appell.

11. MFS was incorporated on 10 November 2006 and its registered office is in Central London. MFS acts as a specialist property finance loan servicer administering bridging loans and related mortgage style products, primarily secured against property in England and Wales.

12. Mr Raja was the founder, Chief Executive Officer and sole director of the company. Three other directors resigned on 1 January, 4 February and 16 February this year. As I have said, the company is part of a larger group of associated companies (it is not a group as defined by the Companies Act 2006 ) comprising 90 or more companies incorporated in multiple jurisdictions.

13. MFS provides financing to residential and SME property investors. It securitises its loans in asset backed securitisation structures to raise finance for its business.

14. The position of the Applicants is that they stand as borrowers under the securitisation structures pursuant to master framework agreements. The Applicants provided security over borrower accounts held at Barclays Bank UK Plc and MFS was obliged to act as the servicer in respect of the mortgage loans provided by the Applicant companies to customers. It is also appointed the servicer under the securitisation documentations. Soon after the appointment it became apparent to AlixPartners that money was unaccounted for. In particular income on the mortgage loans had not been paid into the nominated bank accounts and applied in accordance with the servicing agreements. On 23 February 2026 AlixPartners wrote to terminate MFS’s role as servicer. As well as terminating the appointment and seeking information the February letter explains the Applicants’ position as creditors: “Each of ABL and ZBL appointed MFS as its servicer pursuant to the ABL Servicing Agreement and ZBL Servicing Agreement (respectively) in respect of the mortgage loans ABL and ZBL provided to underlying customers. MFS’ obligations as servicer include collecting the income on the mortgage loans (whether principal, interest or otherwise) from underlying customers and ensuring that income is promptly deposited into nominated bank accounts of ABL or ZBL (as the case may be). Since at least December 2025, MFS has not been acting in compliance with the Servicing Agreements and the Administrators understand that, since at least that date, most of the income on the mortgage loans has not been paid into the nominated bank accounts as required. It is unclear where the missing income is, especially as MFS has not provided this information, despite such information having been requested and despite the fact that MFS is in breach of contract and subject to extensive contractual obligations to provide information relating to the servicing activities and the underlying portfolio. However, at present, the Administrators have reason to believe, pursuant to discussions had between the Administrators and Stephen Katz of BTG Begbies Traynor (London) LLP, that ABL and ZBL are the largest creditors of the broader network of companies owned by, among others, Paresh Raja (including MFS), and have amounts due to them of approximately £1 billion. A significant part of these creditor claims will be due to income on the mortgage loans not being paid into the nominated bank accounts of ABL and ZBL (as applicable), and applied as required, in clear and flagrant breach of MFS’ obligations under the Servicing Agreements. Given the ongoing administrations across the group (both prospective and actual) and the lack of transparency as to what has happened to these monies, it appears inevitable that these breaches will entitle ABL and ZBL to further claims and damages against MFS. Our concerns in this regard were only exacerbated by the fact that it appears from the claim brought against Barclays by MFS and others that these breaches have been ongoing since (at the latest) November 2025 which was never communicated to ABL and ZBL’s lenders. Separately to missing income payments, due to the lack of information and cooperation mentioned above, it remains unclear whether mortgage loans with perfected priority mortgages over the underlying properties, which were funded by and therefore ought to have been held by ABL or ZBL have been improperly dissipated. To the extent that has occurred, ABL and/or ZBL will have further grounds for damages claims against MFS. Based on the information from Stephen Katz of BTG Begbies Traynor (London) LLP referenced in paragraph 2.4, it is evident that the majority of the mortgages that should have been held by ABL or ZBL have been dissipated and these damages claims will be very extensive.”

15. Despite AlixPartners seeking information about the servicing agreements between the Applicants and MFS only limited information has been obtained.

16. In addition to the diversion of monies in breach of the service agreements Mr Appell’s evidence is that MFS had been double pledging assets in respect of the portfolio of mortgages it serviced.

17. Mr Appell’s position is that the Applicant companies are contingent creditors as a result of: (i) MFS’s breaches of the servicing agreements; (ii) a failure to pay an amount due under a Transaction Document on the due date; and (iii) common law claims for negligence, wilful misconduct, fraud or misrepresentation by any officer, employee, agent or representative of MFS. It is evident that (iii) will require further investigation however (i) and (ii) represent existing claims pursuant to the servicing agreements (for missing funds), and the Transaction Document, in respect of which there is a real prospect that MFS will become liable at some future date.

18. I am informed Barclays Bank are owed approximately £600 million; the bank accounts held at Barclays are presently frozen. Adjournment application

19. The principles provided by CPR Pt. 1.1(2) apply to applications to adjourn or extend time. These principles require the court to deal with a case expeditiously and fairly. Fairness applies to all parties and the exercise is one of balance and evaluation. As part of the evaluation the court may have regard to whether an adjournment will make a difference to the outcome.

20. Mr Banner KC and Mr Gupta, acting for Mr Patel and a group of unsecured creditors asks the court for an adjournment. Mr Patel asserts he has a direct claim exceeding £7.8 million. Mr Banner submits that he has authority to make representations on behalf of a wider group of independent unsecured creditors who claim an aggregate of c.£169 million That number, he submitted, may increase. He argues that these unsecured creditors should have an opportunity to put in evidence over the next day or two in order to enable them to have a voice about the identity of the administrators.

21. In his submissions Mr Banner accepted the following: (1) That an administration order will be made by the court and should be made; (2) that there is a public interest in investigating the dealings of MFS and its directors; and (3) that there is urgency in relation to an appointment and any investigation.

22. When deciding on the identity of the administrators, the court will normally be guided by the wishes of the majority of creditors. As Patten J put it in Oracle (Northwest) Ltd v Pinnacle Services (UK) Ltd [2009] BCC 159 : "I have to make a choice and it seems to me that the choice is essentially dictated by the wishes of the creditors, who have a clear preference for Mr Chamberlain over Tenon. It seems to me that where, as in this case, significant creditors have a clear preference for one administrator over another and the secured and other creditors remain neutral, then the court should resolve that matter in favour of the wishes of those creditors, for whose benefit in the end the administration is”

23. The wishes of the majority are clearly important and likely to be the starting point when determining a choice of administrators: Privilege Project Finance Ltd [2017] EWHC 2431. The majority wishes are not the only factor. The court may have regard to whether it will be conducive to the proper operation of the process of administration and whether it is just to appoint the administrators favoured by one group or another. Factors such as conflicts of interest may arise and the court will cautious about appointing an office holder who may be a nominee of one party: Med-Gourmet Restaurants Limited v Ostuni Investments Limited [2010] EWHC 2834 [14]: “There is a public interest in office holders charged with the administration of an insolvent estate not only acting but being seen to be acting in the best interest of the creditors generally; and ensuring that all legitimate claims that the company may have are thoroughly investigated. This is a reflection of a more general principle that justice must not only be done but must be seen to be done. The importance of the principle is reflected, amongst other ways, in the fact that applications for recusal are almost always made not on the ground of actual bias but on the ground of appearance of bias.”

24. On the other hand, the majority creditor view may be counterbalanced by other factors such as a nominated person having already made progress in investigating company affairs. The cost in appointing an alternative candidate is real. Another factor is that of resource. Depending on the complexity of the administration an international firm with large resources may be more suitable than a one man band.

25. With those principles in mind, it is not seriously argued that the Applicants constitute the majority of creditors. Mr Appell explains: “I was also informed by Begbies that (i) with respect to ZBL, which has lent £520 million of debt, there is only £110 million of ‘true value’ available in its collateral account (an unaccounted for deficiency of £410 million); and (ii) with respect to ABL, which has lent £640m of debt, there is only £120m of ‘true value’ available in its collateral account (an unaccounted for deficiency of £520 million).”

26. In addition to these claims Mr Appell informs the court (there is correspondence from many creditors) that the following creditors of MFS support the appointment of AlixPartners: i) Ocorian Trustee and Cronus; ii) A senior lender to Solar Bridging Limited; iii) Trident Funding Limited; iv) GLEU MFS II S.à r.l and GLEU Structured Credit S.à r.l.; v) Barclays Bank; vi) Heliara Finance Limited; vii) Castlelake; and viii) A senior lender of Galaktikos.

27. Mr Appell’s evidence is that collectively these creditors are owed “multiple hundreds of millions of pounds” (he provides a caveat that the exact losses remain to be determined).

28. I reject the argument that £169 million of liquidated debt owed to clients of Mr Banner should weigh more heavily in the scales than the contingent debts owed to the Applicant companies and those supporting the appointment of AlixPartners. Mr Bayfield informs me that in any event the liquidated sum owed to those supporting the appointment of AlixPartners is far greater. I conclude, at least on a summary basis, that the majority of creditors support the appointment of AlixPartners.

29. As to counterbalancing factors, Stephen Katz of BTG Begbies Traynor (London) LLP and Nimish Patel of Coots & Boots Limited are appointed as joint administrators to many of the companies in which Mr Raja was director. Although Mr Appell has floated the prospect of a prior relationship that has been denied by Mr Katz. The issue was not pursued before me. I would not be able to decide such a dispute on the papers. I discount the allegation as a counterbalance.

30. What is undeniable is that Mr Katz and Mr Patel will have spent time and money on understanding the structure of the group of companies, how they interlink (many are special purpose vehicles) and gained insights. On the other hand, Mr Appell, Mr Beveridge and Mr Browne are appointed over the Applicant companies who, I am told, are the largest creditors of MFS and due to the contractual relationships had direct dealings with MFS. Given the witness evidence of Mr Appell, although further investigations need to be undertaken, it is clear that he, Mr Beveridge and Mr Browne have expended time and costs understanding the complex structures built by Mr Raja.

31. In his submissions Mr Bayfield argued that it is also relevant that the only applicants for an administration order who are before the court are the Applicant companies. However, against that is the short notice given to MFS and the creditors represented by Mr Banner.

32. Finally, the court may have regard to the professional status of the proposed administrator, have regard to the regulatory obligations imposed on office-holders, and take some comfort that the administration process will be conducted by professionals who are subject to various statutory and common law duties, both general - for example, fiduciary, and to act with skill and care, and specific.

33. In weighing the evidence that the majority of creditors support the appointment of AlixPartners with the counterbalancing factors, and given the acceptance that the Application is urgent and there is a pressing need for an investigation, an adjournment is highly unlikely to produce a different result than if there were no adjournment. Added to this, time will be lost to those interested in the outcome of the administration, more court time will be taken and further costs expended. For these reasons I refuse the adjournment. The Application

34. The Applicant companies are contingent creditors due to the claims I have explained above: see paragraph 12(4) of Schedule B1 to the Insolvency Act 1986 . The Statutory Conditions

35. The conditions that must be satisfied before the Court can consider exercising its discretion to make an administration order are provided by paragraph 11 of Schedule B1 to the Insolvency Act 1986 : “The court may make an administration order in relation to a company only if satisfied— (a) that the company is or is likely to become unable to pay its debts, and (b) that the administration order is reasonably likely to achieve the purpose of administration.”

36. As regards paragraph 11(a) of Sched. B1 MFS filed its own application for an administration on the basis that it was insolvent. Further Mr Katz and Mr Patel, administrators of other companies controlled by Mr Raja, seek their appointment on the basis that MFS is insolvent. Mr Appell states that the latest audited accounts for the year ending 31 December 2024 show net assets of £15,870,706 before any downward adjustments. He concludes that MFS is balance sheet insolvent given the contingent claims of the Applicant companies alone. The bank accounts of MFS are frozen and accumulated cash is likely to be subject to security. MFS does not appear to argue that it is solvent. In my judgment para 11(a) Sched. B1 is satisfied.

37. The purpose of administration is specified by paragraph 3 of Sched. B1. The administrator of a company must perform his functions with the objective of – “(a) rescuing the company as a going concern; or (b) achieving a better result for the company’s creditors as a whole than would be likely if the company were wound up (without first being in administration); or (c) realising property in order to make a distribution to one or more secured or preferential creditors.”

38. An administration order will be reasonably likely to achieve the purpose of administration if there is a ‘real prospect’ that one or more of the statutory objectives might be achieved: Hammonds v Pro-Fit USA Ltd [2008] 2 BCLC 159 , [24].

39. Mr Appell and Mr Beveridge have signed certificates to state that the purpose of the administration is likely to be achieved. I accept their assessment, which is partly based on commercial grounds. I also accept that in hostile circumstances, where information has not been forthcoming, the proposed administrators may not be able to immediately identify whether their aim is (a), (b) or (c). For example, it may be possible to allow a run-off of the servicing activities to obtain a better result for creditors than if MFS were wound up, but they will not know this before they can lift the bonnet and look at the engine. In my judgment paragraph 11(b) Sched. B1 is satisfied. Discretion

40. Where the conditions in paragraph 11 are satisfied, the court has a broad discretion under paragraph 13 to fashion its response, which discretion is not constrained.

41. I exercise my discretion in favour of making an order for the following reasons.

42. First, the Applicants have serious concerns over the management and seek to appoint independent insolvency practitioners.

43. Secondly, the proposed administrators have the support of the majority of creditors.

44. Thirdly, that the proposed administrators have not had any prior relationship with MFS.

45. Fourthly, Mr Appell, Mr Beveridge and Mr Browne will not be funded by Mr Raja.

46. Fifthly, there is a need now to protect assets that may nbe available for creditors. Procedural requirements

47. The Applicant companies have complied with the procedural requirements in r 3.3 in relation to the contents of the Application and, with one exception, the requirements in r 3.6 in relation to the contents of the witness statement in support of the Application. Given the urgency and need to secure assets I shall dispense with the requirement that the witness statement should specify the Company’s assets and liabilities under r 3.6(3)(a) and abridge service on MFS. Centre of Main Interests

48. Lastly, the central and main interests are in England and Wales. The evidence in support of the Application is that the registered office of MFS is in England and Wales, giving rise to the presumption. In addition a substantial part of the business administration, including head-office function, of MFS was carried out in England and Wales. Conclusion

49. I shall make an order and invite counsel to draft and submit it to my clerk. - - - - - - -