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Wednesday, 26 June 2013

Nouveau World Wines/ Finbow 24th-25th June: Rebecca McDonald's evidence

24th June 2013
Rebecca (Becky) McDonald gave evidence to her defence counsel: Steve Bailey. She had started on Friday - I was not present in court for this. 

Much of her evidence was taken up with going through invoices and payments made by Finbow Wines with Rebecca McDonald giving details of the various payments. I assume that a similar exercise had been conducted by her counsel with payments made during McDonald’s time with Nouveau World Wines. She started there in September 2008.  

McDonald explained that she was involved with accounts covering sales and clients but not after-sales. She had no way of knowing how much wine had been bought, not involved in buying wine and she had no influence over company decisions.

 Among the invoices was one to Eurodirect in July 2009 for the purchase of 6000 leads to be used for the start up of Finbow Wines Ltd. 

McDonald believed that Finbow’s ‘Buy Back Guarantee’ was genuine. She was “horrified to hear a recording of ‘manipulative bullying’ sales tactics that was typical of Billy Davies’ style of work. Had she known of this in September 2009 she “would have walked away – would have resigned”.

 She was “horrified that some investors had paid in £150,000 and had nothing to show for it but had no idea” that this was happening. McDonald thought that enough wine was being bought – “thousands of bottles of wine sufficient to cover the wine bought by investors”. She had nothing to do with the brokers.

 McDonald was taken through a number of invoices and payments to Paul Kelly and his various companies by her counsel. The invoices showed that Kelly was arranged to pay the rent for some people in Finbow including Daniel Snelling and Billy Davies as well as for various cars including a Porsche, which she queried, a Range Rover, a Q 5 (Audi) and a TT Audi. Kelly charged a commission which varied between 10%-15%.

McDonald had a BMW, which she bought seven years ago in a one-off payment of £13,000 before she joined Nouveau/Finbow. Her mortgage payments came out of her salary of £30,000 a year and she received no bonuses.

McDonald explained that often she had to make the transfers before receiving an invoice from Paul Kelly and that she often had to chase him on several occasion to obtain and invoice. “I tried my hardest to keep a track of what was going out.” In October 2009 she created a series of spread sheets detailing payments for cars, rents etc and set them at the end of every month to Daniel and to Billy Davies.

 McDonald described on one occasion how Billy Davies hassled her into making a transfer for him. Davies made a series of phone calls to McDonald including calling her at home during the afternoon when she was looking after her young son who had a kidney problem. “Stupidly I did it going to the bank and kept my son for an hour and half in the cold car. Six weeks later I found out that the transfer was to pay Billy’s rent.”

 She described Billy Davies as confrontational. “I could have asked more questions of the payments to Billy but I didn’t feel that I had the back-up of Daniel and Dina” (Snelling).

Asked about a company called M to M Ltd, McDonald replied that this “was part of Daniel’s wider plans”.  She was acting under instructions from others in the company and in December 2009 had no concerns over the company’s credibility.  Bailey asked her about a series of duplicate invoices – one showing payments required for cars, rents etc. with a second one for wine for the same amount. McDonald said that she had not seen the invoices for wine. She had no idea who had put the second invoices into the file but that these invoices could have been filed by other people in the office. 

At the end of January 2010 McDonald decided that she could no longer continue to work for Finbow and on 29th January sent a letter to Paul Rees, then Finbow’s director, saying she was resigning with immediate effect but would work out her one month notice period. She was no longer able to work with the floor manager (Billy Davies). ‘It had been a real pleasure working with you’ (Rees).McDonald explained that she was not comfortable with the amount of money going out of the company. “I was spending more time in the bank than in the office. It was impossible to keep on top of it. Billy Davies was running the show. She had not spoken to Daniel because he was stepping back from the company.McDonald was then questioned by Simon Dempsey’s counsel. Her previous employment had been with KPMG where she had worked for 14 years as a PA to one of the senior partners managing his diary. She was line manger for support staff. There was no accountancy involved. She earned £34,000 a year. At Nouveau/Finbow her salary was £30,000.

In January 2010 large amounts of cash were going out Finbow. “Money was being spent like it was going out of fashion….so much cash was going out”. Back in October she hadn’t questioned it because there was “a lot of money coming in”. “The month to month bills were being covered.” In January 2010 much more cash was going out of the company than was coming in. McDonald became concerned – “this is not right”.      

Tuesday 25th

Cross-examination by Julian Christopher
McDonald explained that she started at Nouveau in September 2008 to help Dina Snelling with the admin. At the time “there were no records to speak of – no proper paperwork in place”. Her job was to sort out the paperwork. She shared an office with Dina Snelling and had a chat with Dina about recordkeeping but no detailed discussion.  McDonald dealt with the paperwork that was there. She did not deal with records of how much wine was bought and had nothing to do with the stock of wine. McDonald set up a system for recording investors’ purchases. 

Christopher asked her about the CIB (Companies Investigation Branch) investigation by Mr Streeter in March and April 2009. He suggested that the records had been created to answer Streeter’s questions about how much wine had been bought by investors and how much had been purchased by the company. Rather than being created in September 2008, they were created in March 2009. McDonald said that this was not correct. She had set up the system in September 2008 and that it was a work in progress. There was reference to a document that post-dated Streeter’s investigation but McDonald agreed that an earlier version would have been shown to him. Christopher asked why only clients with surnames A-K were recorded and that for many investors listed the column referring to stock in Winevaults was blank. McDonald did not know. She didn’t think that she had put those columns into the document and after she had created the template she had passed it over to Dina for it to be kept up to date. Christopher also asked her why the filing system adopted was so cumbersome for new names of investors.  

During Streeter’s investigation she had asked Daniel Snelling for details of inventory at Winevaults but he did not produce it. Only a few big investors had their own accounts at Winevaults. The rest of the wine was in the Nouveau World Wines account at Winevaults. When Daniel Snelling returned from Australia in early May 2009 he said that he had been shafted and that only half the wine that Nouveau World Wines had ordered had actually been purchased. McDonald said she believed that Daniel was referring to Sultan Trad here.She had no dealings with the Global Wine invoices. Dina Snelling’s evidence was that Becky had been involved. She had no dealings with Riddingtons (accountants in Sidcup), over wine stocks – Daniel Snelling handled this.

McDonald was asked about a complaint from investor Peter Podmore that involved an exchange of emails on 4th and 9th March. Podmore was querying why some of the wines that he had bought were not in storage at Winevaults in Sydney, Australia. He was threatening to expose Nouveau through a blog post and was demanding a full return of his money. Podmore had been in contact with Winevaults.

On 9th March Dina Snelling sent an email to Winevaults that there was 'a discrepancy' over Podmore's paperwork. McDonald was copied into this email. The same day Dina sent an email to Podmore telling him that there is a discrepancy in you wine stocks and until I hear from Winevaults themselves I cant give you the information you require. McDonald was not copied into this email. Christopher said that Winevaults were being told one thing and Podmore another.   

On the advice of Riddingtons Nouveau World Wine was put into liquidation. McDonald explained that Finbow was always part of Daniel’s plans. Although Simon Dempsey was the director, it was Daniel’s company. He was running the company and owned it. The advice from Riddingtons was that Daniel Snelling might to barred as a director because of what had happened to Nouveau World Wines.

Use of false namesWhen Finbow was starting up McDonald was asked to change the name she used in the office in order to hide the connection with Nouveau World Wines - not to link Finbow and Nouveau.

She declined to use a false name but did use her second name Louise rather than Rebecca. Others in the company did change their false names for the changeover from Nouveau to Finbow. Michael Lancaster (Michael Snelling) became Michael Jones. Lucy Jones (Dina Snelling) became Harriet Harbridge, while Daniel Snelling was known as Aston. McDonald said the use of false names did not concern her - she was used to the traders using them. Christopher asked whether Dina Snelling was an opener at Finbow.  He remarked that Dina Snelling had kept the name Lucy Jones during the time of Nouveau World Wines for the sake of 'consistency'. Now the change of name was to "avoid consistency".    

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