New statement raises fresh concerns about iconic Coal Exchange

Martin Shipton

A statement intended to reassure customers of a hotel has raised fresh concerns about the future of the iconic building it is based in.

The company which owns the former Coal Exchange in Cardiff Bay repossessed it from the firm that has been running it as a hotel on December 27.

This followed the serving of prohibition notices by South Wales Fire and Rescue Authority because of health and safety concerns previously exposed by Nation.Cymru.

Disruption

A statement issued at the weekend by the hotel operating company was headed: “Cardiff Freeholder & LLP Company”. It stated: “As you may be aware we have recently experienced significant disruption to our hotel operation and consequently service delivery. We are currently operating in line with demands being made by the freeholder and are to understand the freeholder and the former leaseholder are disputing ownership.

“Please be assured that we are working diligently with our legal advisers to minimise any further disruption to the business and want to assure our customers [that] they remain our priority whilst these matters are being addressed. Although we do wish these matters could be addressed in private, we understand the public interest in the building. All customers should be aware that their pre-booked accommodation, weddings and events will go ahead as planned.”

However, former Cardiff Labour councillor Ashley Govier, the sole director of Eden Grove Developments, the company that owns the freehold of the company, said: “This statement has not been approved by the freeholder. There is no dispute over the ownership of the building.”

Temporary permission

Mr Govier said the operating company had been granted temporary permission to run the hotel on a week-by-week basis as his company takes advice about the physical state of the building from professional engineers. The operating company had been told to stop the unauthorised letting out of rooms owned by individual investors.

Nation.Cymru has reported previously how documents showed that early in 2023 HMRC was pursuing the Exchange Hotel for unpaid VAT totalling more than £160k and unpaid employer national insurance contributions of more than £132k.

A further document seen by Nation.Cymru showed how in April 2023 an insurance policy on the building was cancelled because the insurer had not been made aware that it was in a poor state of repair.

The operating company was run by businessman Anil Rai, from Eastbourne. Mr Rai was previously a designated member [equivalent to director] of Focus Wealth Management LLP [Limited Liability Partnership], whose licence to operate was revoked by the Financial Conduct Authority (FCA) in 2015 after the firm failed to meet its financial commitments.

A statement issued by FCA at the time said: “This firm’s authorisation has been revoked by the FCA and/or PRA [the Prudential Regulation Authority] as a result of enforcement action and they can no longer provide regulated activities and products. There has been disciplinary or regulatory action involving this firm.

“On the basis of the facts and matters and conclusions described in the Warning Notice, and in the Decision Notice, it appears to the Authority that FWM is failing to satisfy the Threshold Conditions, in that the Authority is not satisfied that FWM is a fit and proper person having regard to all the circumstances, including whether FWM managed its business in such a way as to ensure that its affairs are conducted in a sound and prudent manner.”

Struck off

Focus Wealth Management LLP was struck off the Companies House register in 2019 after failing to file its accounts.

A source at the hotel said: “In October last year, senior staff members brought their concerns, particularly health and safety ones, to Anil and we gave him two weeks for them to be actioned. Many weren’t carried out, and staff were told that there were other priorities at the time. When the eviction notice arrived, Anil assured staff that it was a personal attack and would not happen.

“Since news of the eviction was publicised, customers have been quick to blame the staff but we are in the same boat as the public. We are doing what we can. The main issue is the director who doesn’t want to help. And like our customers, we are having to find things out in real time from the press as no one is talking to us. Staff don’t know if they’re going to get paid, which is especially worrying at this time of year.”

Nation.Cymru has previously reported seeing a court summons issued to Mr Rai’s Coal Exchange Operations Ltd on September 4 2023 for unpaid business rates and costs totalling £81,690.94.

We have also seen evidence of many thousands of pounds being transferred to Mr Rai’s company.

Mr Rai has not responded to our messages.