Loan to Northampton Town 'financed other projects'

Unfinished East Stand at Sixfields Image copyright Getty Images
Image caption Northampton Town was loaned £10.25m but work on the East Stand ceased last year

Thousands of pounds of taxpayers' money to fund a football stadium project may have been diverted to finance a string of other schemes, the BBC has found.

Northampton Town was loaned £10.25m of which £8.75m was passed on to developer Howard Grossman and his associates.

But some of the money, loaned by the council, appears to have funded seven unrelated building applications connected with their firms.

Mr Grossman says he does not recall the payments.

Image caption Architect Stuart Loxton confirmed he had been instructed by an employee of the County Group to make the invoices out to 1st Land Limited, entitled "Northampton Football Club"

A criminal inquiry is already under way into "alleged financial irregularities" surrounding the council's loan to Northampton Town, known as the Cobblers, for a new stand which was never completed.

Now the BBC has seen invoices totalling almost £8,000 to Mr Grossman's company.

Image copyright Northampton Town FC
Image caption Plans for a 2,000 capacity East Stand were announced in October 2013

They are all titled "Northampton Town" and were made out to 1st Land Ltd, which was set up to operate the football club stadium project.

But the work, billed by architect Stuart Loxton, is for developments up to 50 miles away in Bushey, Barnet, Borehamwood, Elstree, St Albans and Bricket Wood.

The firm 1st Land Ltd had received £7.25m of the loan money and was set up by Mr Grossman.

Through his solicitor, Mr Grossman said Mr Loxton was retained for the Northampton project and that there was no evidence the invoices were for work carried out outside of this development.

Earlier this month the BBC revealed how High Court documents contained allegations that millions of pounds of this money had been "misappropriated" by Mr Grossman and people connected with the Bushey-based County Group, the trading name of companies owned by him.

The claim - made by the football club and its former chairman David Cardoza in the court papers - alleged a substantial part of the loan had been used for purposes unconnected with the stadium development.

The claim was settled out of court and the parties signed a non-disclosure agreement.

'Deeply offensive'

Mr Grossman has said in a previous statement that it was not for him to explain how money provided on account was spent.

He has also described the allegations against him and his associates "as outrageous and deeply offensive".

According to planning documents submitted to Hertsmere Borough Council, the applications for which Mr Loxton was paid were submitted by Stephen Hewitt and a company owned by Marcus Grossman - both County Group employees.

There were also a number of applications for a cemetery in Barnet on land owned by County Group.

When planning permission was granted, the County Group's chief executive Simon Patnick told the Jewish Chronicle in March last year: "It will give people a choice for burial rights they haven't had for generations before."

Mr Loxton said he was instructed to make out his invoices to 1st Land Ltd.

He confirmed he had been instructed by an employee of the County Group to make the invoices out to 1st Land Limited, entitled "Northampton Football Club", telling the BBC "they were for planning application drawings for numerous sites in Hertfordshire."

Through his solicitor, Marcus Grossman told the BBC he instructed Mr Loxton on one project and that the invoice was paid by his company, Magro Properties Ltd, not 1st Land.

He said he could provide a photocopy of the cheque and proof it was cashed.

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