Newcastle’s superclub and pub destination The Lofts and The Hustle closed down with debts of more than £7m, documents reveal.
The nightclub and bar – opened less than two years ago by Dead Vibey Leisure Limited – closed its doors last month after becoming involved in an ongoing investigation by the financial watchdog into a separate business owned by one of its directors, John Dance. Mr Dance had launched the city’s biggest nightclub in August 21 alongside co-founders Rob Seaman and Marty Smith, pledging to give the North East’s clubbing sector a much-needed boost following months of pandemic lockdowns.
But the shutters came down in May on the two venues, and all 79 staff were made redundant, following the appointment of business restructuring specialists at FRP Advisory on May 15. The move came a month after WealthTek LLP, a company founded by Dead Vibey Leisure Limited director John Dance, was ordered to cease operations immediately by the FCA after “serious regulatory and operational issues” came to light. Mr Dance was CEO of WealthTek LLP, which trades as WealthTek, Vertem Asset Management and Malloch Melville.
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Since then, the administrators working on the shuttered wealth management firm WealthTek LLP have found a potential £81.4m shortfall in client money and director John Dance has seen assets worth £40m frozen amid a fraud and money laundering probe. The FCA says WealthTek, which had about 1,470 clients and also traded as Vertem Asset Management and Malloch Melville, did not have permission to hold client money or custody assets.
Now a statement of Dead Vibey Leisure’s financial affairs has been filed, showing the firm went into administration with a deficit of £7.229m – with almost £7m owed to a firm where John Dance is one of two directors. A total of £311,115.33 is available for preferential creditors, which includes the staff, and the document shows £33,716.94 is owed to staff in terms of redundancy payments, employees and pension. HMRC, meanwhile are owed £32,784. That leaves £244,614.39 for unsecured creditors.
Unsecured claims include a £6.874m claim from a ‘connected party loan’, as well as £489,366.10 bill for trade creditors and a Bounce Back Loan of £31,814. And the list of creditors – which includes caterers and a raft of other food and drink suppliers, DJs, an air conditioning company, shows Collingwood Wealth – a company of which John Dance is a director – has submitted a claim for £6.874m.
Jet2 Holidays is also listed as a creditor, with a claim of £4,650.
At the time of FRP’s appointment, Steven Ross, partner at FRP and joint administrator of Dead Vibey Leisure Ltd, said: “Due to an ongoing investigation by the FCA, the directors of Dead Vibey Leisure Limited appointed us as joint administrators. Regrettably, this also meant all 79 staff were made redundant on appointment. We’re now supporting impacted staff and preparing for an asset sale.”
