Magistrates fined the owners of the BED club in the Grand Arcade £5,000 with £2,095 costs last Thursday after 656 litres of fake spirit were found on the premises in September last year, the biggest seizure to date of fake vodka by Trading Standards in West Yorkshire.
But it appears that the £5,000 fine is the least of the club’s recent financial woes.
The group that manages the club’s parent company has been having difficulties and has undergone what’s called a “pre-pack administration” after finding itself unable to pay its debts, including £3m to Barclays Bank and £500,000 to HM Revenue & Customs, according to a report today in The Publican’s Morning Advertiser.
Apparently that’s when a buyer is lined up for all or part of an insolvent company’s business or assets before administration gets under way. Often the buyer includes some or all of the directors of the previous company. “It’s a useful method of restructuring business finances, including a clean break from burdensome liabilities,” says the Business Recovery website.
(What I’m not clear about is what happens to the debts of a company when it’s sold in that way. And its creditors? Anyone know?)
“Strategy moving forwards”
In any case, something along those “pre-pack” lines has happened to the Gatecrasher nightclub group behind BED’s parent company, Gatecrasher Clubs and Bars Ltd.
There’s still a business and a parent company (which has a “strategy moving forwards”). And there’s a “current management team” (which has a “vision for clubbing”). It’s just that the BED club off New Briggate doesn’t fit into either the strategy or the vision.
That much can be gleaned from the comments of a spokeswoman for the club speaking to the Yorkshire Evening Post today:
“The location and configuration of the venue no longer matches with the current management team’s vision for clubbing.
“The venue is too small and despite the proposed development of the Grand Arcade, the parent company’s strategy moving forwards is for large capacity clubs in city centre locations.”
According to the YEP, she said that the owners have plans in place for one-off, large scale indoor and outdoor events in the area.
And the fake vodka?
Officers went to the three-storey club off New Briggate in September last year following a complaint that the club was selling counterfeit vodka, according to a report on the West Yorks Trading Standards Service’s website.
They found 656 litres of fake spirit labelled as “Premium vodka”, which the manager had just removed from sale that evening as a result of customer complaints, the report said.
“The drink was tested by the West Yorkshire Public Analyst and found to contain isopropanol, tertiary butanol and chloroform, none of which should be in vodka. All the bottles were subsequently seized by Trading Standards officers.
“The investigations revealed that the drink was obtained through a broker as a ‘cash deal’, arranged through the head office of Gatecrasher Clubs and Bars Ltd, which is based in Sheffield. The case against the supplier was adjourned until 13th September 2013,” the report said.
Trading Standards Committee Chair Cllr Val Slater said it was lucky the manager acted fast and no-one was harmed.
“I am astounded that a nightclub operator could have such scant regard for public safety by buying drink in this manner,” she said. “Adequate checks were not carried out on the product before it was put on sale and the unusually low price and basic packaging should have raised suspicions.”