Even the Serious Fraud Office (SFO) has launched an investigation into the former management of Home REIT, once Britain’s largest social housing group. They are investigating allegations of fraud and bribery that may amount to up to £300 million. The sweep of this investigation has culminated in the arrest of six individuals. Among them are the five men and one woman, all aged 40 to 80, connected to the past management cadre of Home REIT.
Over the past three years, Home REIT has raised an impressive £850 million in investments. Via partnerships with 17 local not-for-profit housing organizations, by their count they’ve housed over 3,000 people in need. Their business model focuses on buying and renovating single-family homes. Its prime purpose is getting housing immediately to the most vulnerable, including those living on the streets, veterans, and those with addiction. With increasing alarm about its practices, the group suspended trading on the London Stock Exchange in January 2023.
The SFO’s investigation has led to a series of raids at six locations in the UK, including north London, Altrincham, Maidenhead, and Manchester. These searches are efforts to find out what exactly led to this alleged financial misconduct at the company. This endeavor contributes to a larger examination of the issue.
In November 2022, an investor report raised alarming allegations about Home REIT’s practices. In particular, it challenged the valuation of the properties and argued that tenants would be unable to pay their rent. This report attracted significant public scrutiny and eventually helped force the company’s hand in its decision to suspend trading.
Andy Parratt, who is involved in the investigation, noted the gravity of the situation, emphasizing that it “impacts some of the most vulnerable people in society.” He further stated, “We had over 150 staff involved in the deployment, and so it’s still early days in the investigation, but we are trying to establish exactly what’s happened in terms of the management of Home REIT and the reason that it collapsed.”
While the investigation continues, many stakeholders are looking to find out what went wrong with the reported mismanagement. They hope to understand how this affects the at-risk people that were supposed to benefit from Home REIT’s mission. This case could affect all of us that are tied to Home REIT. Second, most importantly it could help raise key questions around accountability for social housing projects funded with public dollars.
