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Showing posts with label debts. Show all posts
Showing posts with label debts. Show all posts

Sunday, August 1, 2010

Fergie in fresh cash crisis after struggling to pay £6,500 debt to the Queen... for stamps



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Fresh cash crisis: The financially challenged Duchess of York faces a £6,000 postal bill from the Queen

The Duchess of York was facing fresh embarrassment today after running up a bill of £6,500 using the Queen’s special mail service.

The cash-strapped Duchess, 50, used the service to send out signed photographs and gifts to friends at home and abroad - and was warned she might be barred from using it further unless her debt was cleared.





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How Fergie's novel might look: The story, set in 1812, tells the story of a fiery redhead called Sarah - although Fergie insists 'this isn't a story about me'

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Digging in: The manuscript delivered by Fergie and Laura Van Wormer was rejected because it did not contain enough sex, and the pair were reluctant to make changes to the story

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Signed photos and gifts: Sources say Fergie, pictured with Naomi Campbell, is always sending letters and gifts to her friends and acquaintances

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Not amused: A former employee at the Windsor Castle mail room, which handles mail from the Queen and other royals, said Fergie's unpaid bills were 'bible thick'

The disclosure that the Duchess, who reportedly has debts of up to £2 million, failed to keep up payments is just the latest in a series of damaging revelations about her finances.

The Duchess, who still lives with her ex-husband Prince Andrew at Royal Lodge in Windsor, used the mail room at nearby Windsor Castle on ‘an almost daily basis’ to send out hundreds of letters, photographs and gifts.

Items mailed out included silver letter openers, money clips and cuff­links bought from jewellers including Patrick Mavros and Theo Fennell in London and Tom French in Ascot.

Staff from the Duchess’s office at Royal Lodge would make the three-mile journey by car to drop the packages at the ground-floor mail room, where they would be franked before being sent out.

The aide who had dropped off the mail would then be given a chit detailing the cost.

The Windsor Castle mail room is part of the Court Post Service, which handles all deliveries for the Royal Household.

The service, which dates back to the early 1900s, has its own fleet of vehicles and is run by Royal Mail staff seconded to Royal palaces.

One former employee, who asked not to be named, said individual deliveries could cost several hundred pounds.

They added that the invoices would be placed in one of two A4 files in the Duchess’s office which were ‘Bible thick’ with unpaid bills.

The staff member said: ‘The Duchess knows a load of people and she was always sending out cards and gifts for birthdays and special occasions. A couple of months ago it became clear there were problems with arrears on the account.

There were a number of phone calls to the office to chase up payment and staff who drop off the mail at Windsor Castle would be hassled about it. It was a case of, “Tell the office this is the last time unless the bill is cleared”.’

The Duchess is also reportedly in debt to a number of businesses in Windsor, including a butcher’s and a dry cleaner.

A newsagent is believed to have stopped delivering newspapers because of an unpaid £500 bill.

A spokesman for the Duchess confirmed that she had an account with the Palace’s internal mail service. He said she had cleared the arrears last week.

Buckingham Palace declined to comment on the matter.

The Mail on Sunday can also reveal that the Duchess may declare herself voluntarily bankrupt in a bid to deal with her financial problems.

The proposal is one of a number of options being considered by officials in Prince Andrew’s office who have taken over responsibilities for the Duchess’s affairs.

One source said: ‘The voluntary bankruptcy idea is just one of a number of options being considered. No firm decisions have been made yet. The Duchess is involved in talks over a number of projects including a possible slot on Oprah Winfrey’s new television network.

‘She wants to await the outcome of those negotiations before deciding what to do.’

Debtors can declare themselves bankrupt if they feel there is no alternative course of action. Anyone who opts for voluntary bankruptcy is guaranteed their living expenses and will have to pay back only what the receiver decides they can afford. In some cases they may not have to pay back anything at all.

A friend said: ‘It is not an idea the Duchess would be keen on and it is not something she would rush in to. She may have her faults but disloyalty isn’t one of them.

‘She will feel obligated to repay anyone who has provided a genuine service and is owed money. Everyone is hoping that the deal with Oprah works out. Sarah has been in terrible situations before and has always managed to climb back.’

The Duchess has been mired in controversy since May when she was filmed taking £27,000 from an undercover reporter, promising him access to her ex-husband for a further payment of £500,000.

There is no suggestion that Prince Andrew, Britain’s international trade representative, knew about the arrangement. The Duchess later confessed that she was drunk.

Both Buckingham Palace and the Duchess’s spokesman declined to comment on the possible bankruptcy.

Riddle of Sarah's bodice-ripper with 'not enough sex'

The Duchess of York could be forced to hand back £50,000 - more than five years after receiving the advance to write a raunchy historical novel.

Sarah Ferguson is now under pressure to produce the bodice-ripper within the next 12 months to avoid further damage to her troubled financial state.

Although her literary reputation is built on writing children’s books about a cheeky helicopter, the 50-year-old Duchess is said to have received the payment for a tome based on a 19th Century female aristocrat.

According to one source, the Duchess did produce an 800-page manuscript two years ago - but it was rejected as it did not contain enough sex for the publishers, New York-based St Martin’s Press.

That draft was co-written with American crime novelist Laura Van Wormer, although Fergie is now believed to be working with a new, unnamed, collaborator.

A source said last night: ‘What it comes down to is that the book Sarah and Laura wrote is not what the publishers want.

‘I’ve got no idea how this happened as they submitted a 100-page pitch which was bought by St Martin’s, so everyone knew what they were getting themselves into.

‘St Martin’s wanted more sex and characters who never left the house. What they got was this epic set over decades which is full of plot twists, wild horses, battles, guns - not really your typical drawing room romance.

‘The publishers kept demanding changes and Sarah and Laura just said “No”. This was what they were doing and that was it. Things just got worse from there on in. Everyone dug their heels in and now we are in deadlock.’

The Duchess’s spokesman said last night: ‘The Duchess cannot recall the exact amount of the advance, but she thinks it was under six figures.

‘The book will be produced within a year and the Duchess will honour her commitment despite these difficulties.’

Nobody from St Martin’s Press was available for comment, despite numerous attempts to contact its executives at work and at home.

The Duchess’s novel was originally entitled Hartmoor, the same name as the Manhattan-based company set up to manage her media and public speaking career.

But the title has now been changed to Wingfield after the firm went bust in October 2009 with debts of more than £630,000.

Set in 1812, the novel tells the story of a fiery redhead called Sarah - although the Duchess has insisted that ‘this isn’t a story about me’.

The central character is Lady Sarah Montagu, the only child of the 9th Earl of Hartmoor, who travels to America to find her kidnapped father.

The initial chapters were written by the Duchess and Van Wormer during a week-long cruise on board Cunard’s Queen Mary 2 from Southampton to New York in spring 2007

The trip, during which Fergie made five speeches written for her by Bill Clinton’s former speechwriters, came courtesy of Spanish-owned tiling firm Porcelanosa.

Sources said the Duchess was paid a £250,000 fee by the company, which also picked up the tab for the cruise, including paying for her entourage: a hairdresser, personal trainer, make-up artist, two assistants, Ms Van Wormer, four staff from Hartmoor plus a male business friend.

Sources with an intimate knowledge of the book have told The Mail on Sunday that by the time the QM2 docked in New York, one third of the novel had been written.

Porcelanosa has previously been under scrutiny for its relationship with Prince Charles, following investigations by The Mail on Sunday.

The company was awarded a Royal warrant after carrying out work at his residences, and has donated hundreds of thousands of pounds to the Prince’s favourite charities.

St Martin’s Press is one of America’s biggest publishers, with a host of bestselling authors including Dan Brown, Jackie Collins, Frederick Forsyth, Barbara Taylor Bradford and Robert Ludlum.

Neither Ms Van Wormer nor her literary agent responded to requests for comment.



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Friday, November 27, 2009

Dubai debt fears remain focus in world markets-US, Emerging Market Stocks Slide as Bonds Advance on Dubai


Dubai will soon have the world's tallest building



The Atlantis launched last year with a party rumoured to cost $20m


New York Stock Exchange traders- As market drop 5%.

The Dubai skyline


A money trader work at a dealing room the U.S. dollar rate against Japanese yen on the Foreign Exchange Market in Tokyo, Japan, Friday, Nov. 27, 2009. The U.S. dollar fell to the 84 yen level Friday Morning.


A man walks in front of the electronic stock board of a securities firm in Tokyo, Japan, Friday, Nov. 27, 2009. The benchmark Nikkei 225 stock average fell 301.72 points, or 3.2 percent, to 9,081.52.


A man who shines shoes works in front of screens showing the Korea Composite Stock Price Index (KOSPI) and foreign currency rate, right, at the Korea Exchange Bank headquarters in Seoul, South Korea, Friday, Nov. 27, 2009. The KOSPI fell 75.17 points, or 4.70 percent, to close at 1,524.35 Friday.



A woman using mobile phone walks by an electronic stock board of a securities firm in Tokyo, Japan, Friday, Nov. 27, 2009. The benchmark Nikkei 225 stock average lost -169.73 points, to end morning session at 9213.51.


A man communicates with a phone in front of the electronic stock board of a securities firm in Tokyo, Japan, Friday, Nov. 27, 2009. The benchmark Nikkei 225 stock average lost -169.73 points, to end morning session at 9213.51


A money trader walks past a screen indicating the U.S. dollar rate against Japanese yen at the Foreign Exchange brokerage in Tokyo, Japan, Friday, Nov. 27, 2009.


A man looks at the electronic foreign exchange board of a securities firm in Tokyo, Japan, Friday, Nov. 27, 2009. The U.S. dollar fell to the 84 yen level Friday Morning.


A South Korean currency trader reacts in front of a screen showing the Korea Composite Stock Price Index (KOSPI) at the Korea Exchange Bank headquarters in Seoul, South Korea, Friday, Nov. 27, 2009. The KOSPI fell 75.17 points, or 4.70 percent, to close at 1,524.35 Friday.



Banks outside the Gulf played down their exposure to Dubai debt on Friday after fears of default shook global markets, and European leaders said the world economy was now strong enough to cope with the setback.

Stocks from Tokyo to New York were haunted by concern that banks were exposed to state companies in Dubai, whose rise from a desert backwater into the business hub of the world's top oil exporting area lured expatriate cash and executives.

The crisis began on Wednesday when Dubai, part of the United Arab Emirates federation, asked to delay payment on billions of dollars of debt issued by conglomerate Dubai World and its main property subsidiary Nakheel, developer of three palm shaped islands that once attracted celebrities and the super-rich.

"While it is a setback, I think we will find it is not on the scale of previous problems we have dealt with," British Prime Minister Brown told reporters in Port of Spain.

"The world financial system is stronger now and able to deal with the problems that arise."

French Prime Minister Francois Fillon said the Gulf had the resources to ensure the world would not sink into a second round of turmoil, but Russian premier Vladimir Putin said the saga showed how hard it is to shake off a crisis that has lasted two years.

Dubai World had $59 billion of liabilities as of August, most of Dubai's total debt of $80 billion. International banks' exposure related to Dubai World could reach $12 billion in syndicated and bilateral loans, banking sources told Thomson Reuters LPC.

But the numbers pale in comparison to the $2.8 trillion in writedowns the International Monetary Fund estimates U.S. and European lenders will have made between 2007 and 2010.

"The events in Dubai in recent days are one of the hiccups if you like, one of the difficulties, which affirms that we were right to highlight the uncertainty ahead of us and that the road ahead could be a bumpy one," European Central Bank Governing Council member Athanasios Orphanides said.

Analysts expect Dubai to receive financial support from Abu Dhabi, though it may have to abandon an economic model focused on developing swathes of desert with foreign money and labour.

But the prospect of a bailout did little to allay concerns among investors, already worried the global economy may not be recovering quickly enough to justify a near doubling of prices for emerging market stocks and many commodities since March.



Wall Street, which was closed on Thursday for the U.S. Thanksgiving holiday, opened sharply lower on Friday over fears of renewed financial turmoil. Banks with Gulf investors were badly hit, with Citigroup (C.N) down over 3 percent. [ID:nN27341479]

"Dubai is deeply connected with the global community and people are worried about a domino effect with other points of the financial system," said Kevin Caron, U.S.-based market strategist at Stifel, Nicolaus & Co.

BANK EXPOSURE

European and Asian banks scrambled to distance themselves from problems in the Gulf trade and tourism hub, helping European stocks reverse earlier losses and hit session highs as the market reassessed the significance of Dubai's problems.[.EU]

"We have seen a classic risk aversion reaction in the markets over the past 24 hours. The dollar has slumped, the yen is stronger," a Societe Generale note said. "At this stage, this setback looks to be one that is very much country specific."

Lenders in Abu Dhabi, a fellow member of the UAE and home to most of its oil, have lent heavily to Dubai and could suffer.

Abu Dhabi Commercial Bank ADCB.AD has at least 8-9 billion dirhams ($2.2-$2.5 billion) exposure to Dubai World and related entities, forcing the bank to book more provisions, a senior executive of the bank said. First Gulf Bank FGB.AD has at least 5 billion dirhams ($1.4 billion).

JP Morgan said it was less concerned about global banks' direct exposure to Dubai World and was not worried about Abu Dhabi, which is sitting on hundreds of billions of dollars.

"We are more concerned about the spillover effect within the UAE," it said in a note. "It remains unclear if the Dubai government will support the liabilities of government related entities."

The price of insuring Gulf debt surged again on Friday.

Credit default swaps (CDS) for Dubai rose more than 100 basis points but were well below previous peaks in the global crisis late last year and earlier this.


Nakheel's Islamic bond prices extended losses, falling 30 points to a record low of 40, according to Reuters data.

The debt crisis in Dubai also pushed up debt insurance costs for other sovereigns in the Gulf, a wealthy region Western firms had turned to for help at the height of the credit crunch, and at some major U.S. banks.

TRANSPARENCY, CREDIBILITY

International fund managers said they were considering rotating dedicated money out of Dubai and into Abu Dhabi, Qatar and Egypt after local markets begin to open on Monday after the Muslim Eid al-Adha holiday.

Analysts said the timing of the news on the eve of the holiday, the lack of prior communication with investors, and the scant details given on the plans dented Dubai's credibility.

"The way the announcement was made, including its timing has caused damage to Dubai's credibility," Ghanem Nuseibah, senior analyst at Political Capital Policy Research & Consulting Institute. "This will take a very long time to repair."

UAE media either ignored or put a positive spin on the news. Abu Dhabi-based financial daily Alrroya Aleqtissadiya carried the headline "European markets overreact to Dubai's bond news".

But HSBC (HSBA.L), Europe's biggest bank and the one with more loan exposure to the UAE than any other at around $15.9 billion, said it was not concerned.

"It's... a high potential part of HSBC's international business mix and a region we are completely committed to," Michael Geoghegan, HSBC CEO, said.

"I am confident that the leadership of Dubai and the UAE will overcome any short-term issues they face, which appear to have been somewhat sensationalised."


World Economy concerns about Dubai debts remains.

European stock markets regained their poise Friday after Wall Street didn't fall as much as feared on the news earlier this week that Dubai is having trouble handling its debt.

Because U.S. markets were closed for Thanksgiving Day on Thursday, they are only reacting now to the fears that Dubai's debt problems may affect the wider financial system.

In Europe, the FTSE 100 index of leading British shares was up 41.30 points, or 0.8 percent, at 5,235.43 while Germany's DAX rose 50 points, or 0.9 percent, at 5,669.84. The CAC-40 in France was 36.85 points, or 1 percent, higher at 3,716.08.

On Wall Street, the Dow Jones industrial average was down 162.71 points, or 1.6 percent, at 10,301.69 soon after the open while the broader Standard & Poor's 500 index fell 19.33 points, or 1.7 percent, at 1,091.30.

Though hefty, the losses in the U.S. paled in comparison to those posted earlier in Asia, when indexes in Hong Kong and South Korea tumbled 5 percent in response to the previous day's Dubai-related losses in Europe.

Confidence about the world economy has been hit hard by the news that Dubai World, a government investment company with around $60 billion worth of debt, has asked creditors if it can postpone forthcoming payments until May. Investors are wondering whether the current uncertainty surrounding the emirate has brought the eight-month equities bull run to an end.

Analysts said more clarity about the long-term impact of Dubai's troubles would likely emerge next week, when Wall Street is back to normal trading hours following the Thanksgiving Day holiday. U.S. markets are only open for half the day Friday.

"It is likely to take at least a few days before the implications of the impact of a possible default from Dubai are properly digested but for the present it seems that the market is seeing this negative news as a blow to the global recovery but not one that will push it off course," said Jane Foley, research director at Forex.com.

Investors were also keeping a close eye on associated developments in the currency markets after the dollar slid to a new 14-year low of 84.81 yen.

However, the dollar climbed back off its lows to 86.74 yen amid mounting expectations that the Bank of Japan may intervene in the markets by buying dollars or selling yen after Japan's finance minister Hirohisa Fujii said he was "extremely nervous" about the movements in the yen and that the "market had moved too far in one direction."

On Thursday, the Swiss National Bank reportedly intervened to buy dollars to prevent the export-sapping appreciation of the Swiss franc. That seems to have worked — for now, at least — as the dollar has moved back above parity, trading 0.9 percent higher at 1.0118 Swiss francs.

The British pound has also been battered amid fears about the exposure of Britain's banks to the region. The pound was down nearly one percent earlier but recovered some ground to be trading only 0.3 percent lower at $1.6475.

Another currency struggling somewhat in the current climate was the euro, which fell 0.5 percent to $1.4943 — in times of uncertainty the dollar is considered to be more of a safe haven currency. Investors are also concerned about the exposure of European banks to Dubai.

Earlier, Asian stocks were particularly badly hit as they played catch-up following the big losses in Europe in the previous session. Hong Kong's Hang Seng closed 1,075.91 points, or 4.8 percent, lower at 21,134.50, while South Korea's benchmark plummeted 4.7 percent to 1,524.50.

Elsewhere in Asia, Japan's Nikkei 225 stock average fell 3.2 percent to 9,081.52 while Australia's index dropped 2.9 percent. China's main Shanghai stock measure was off 2.4 percent.

Indexes in emerging markets have so far avoided a second day of heavy losses, with Russia and Brazil down about 1 percent.

Oil, meanwhile, tracked developments in stock markets and benchmark crude for January delivery fell $3.30 to $74.66 a barrel in electronic trading on the New York Mercantile Exchange.


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