Wrapit directors loaned £150,000 before collapse

Directors of failed online wedding list company Wrapit are thought to be among the creditors of the company, having loaned it £150,000 before the company went under.

The company's latest available accounts show that the directors had loaned £450,000 the previous year, but the company said this week that those loans had been repaid in May of 2007.

Managing director Peter Gelardi added that the directors extended a further £150,000 in August 2007 to help the company over the slower autumn period, which has not been repaid.

‘[When the loans were repaid] at that point there was nothing wrong with the business. If we had wanted to reduce our exposure we wouldn’t have put in any loans,’ he said.

He added that he, together with finance director Nigel Taylor and director Nicholas Haimendorf, had also signed personal guarantees totalling £300,000.

Gelardi believes the company could have survived despite credit reference agency Graydon UK describing it as ‘technically insolvent’ for a number of years.

‘The company has a negative net worth, but it didn’t make the company insolvent.

‘At the time we were in negotiations with financiers to provide the additional funding required which we thought would be forthcoming,’ said Gelardi.

He said other financiers pulled out when HSBC, which ran Wrapit’s online credit card payments, held back on nearly £1m of funds.

The bank denied it was responsible for the company’s failure. ‘HSBC believes it has done all it can to assist the directors. Any suggestion that HSBC is responsible for Wrapit’s problems is absolutely refuted,’ said a statement.

Administrators KPMG said Wrapit’s net debts are in the region of £6.5m. HSBC is owed £3.2m.