x Abu Dhabi, UAEFriday 19 January 2018

Turning a profit these day can invoke suspicion

A few years ago I was enjoying a well earned siesta, drowsily listening to the cicadas in the olive trees, when my phone rang.

A few years ago I was enjoying a well earned siesta, drowsily listening to the cicadas in the olive trees, when my phone rang. "Hello," said a voice. "I'm Susie and I'd like to interest you in one of my PR clients." "How did you get this number?" I asked. "Your editor gave it to me." At the time I was earning a sumptuous living as a property writer for The Times newspaper. I would travel the world in exchange for writing 500 words on new housing. But as a rule I tried to avoid meeting developers: they take you to secluded beaches then produce ghastly models of what they plan to build and expect you to write a glowing article in exchange for a pair of pina coladas.

"These two are different," she said. "They are young, do nice properties and they live near you. They will buy you lunch. And besides, one of them wants to meet you because he read your book." This is always a good thing to say to a writer. Most people say something completely different, such as "I saw your book in a shop but didn't buy it" or "does your publisher have an editor?" or "do you have a copy you can lend me?"

I agreed to go and meet them, fuelled up the Jaguar - itself no mean task in France because petrol is so heavily taxed - and set off down the plane tree-lined roads. Lunch was at a seafood restaurant and I was pleased to find my hosts young and entertaining. Afterwards they took me to see their latest development. I was surprised to see that they were well-built homes with nice gardens full of flowers, and beautifully furnished. The pair were self-critical too, pointing out where they could have done a better job.

Over the next few months we became friends. They went on to do two further developments together, one of them a former convent that they turned into a hotel. The Sunday Times called it the "best small hotel in the south of France". Even allowing for journalistic exuberance, it was a good place to spend a night. A couple of years ago, my two friends parted company. The Irish one decided to stick around in France. "In Dublin everyone's an entrepreneur," he said. "Here there is hardly any competition."

He bought a chateau that he planned to turn into 25 or so units that he would sell off-plan. Then Lehman Brothers went into liquidation and off-plan property sales were about as popular as chocolate sun-loungers. This summer I saw my friend again. He was surprisingly chipper. "I've sold just about all of them," he said. I was delighted to hear this, and wished him well. This week I received an e-mail. His news was grim. All the properties remained sold, planning permission was solid, but his bank, which had originally demanded that he put up ?500,000 (Dh2.7 million), was now asking for a further ?500,000 before they would disburse a centime. Did I by chance know anybody who might be interested in a short-term loan that would pay out 20 per cent interest?

I was relating this story to a few colleagues on a drive to Dubai and promised to send them more details. The next day I did just that, and copied in a few others from my address book, pointing out that this might be a good opportunity. If I had some money myself I might have been tempted, but I share a bank account with my wife and whenever there is any money in it, we race to empty it. Anybody who knows my wife will appreciate it is no contest.

A few contacted me for more details; one friend, who shall be nameless, pointed out that my Irish pal was clearly in need of help but he preferred to wait until the terms got even more generous. Suddenly an e-mail thundered into my inbox. "Twenty per cent return!!!!! Bernie Madoff anyone?? 20 per cent returns do not exist in the real world chaps. The business journalists cc'd on this e-mail maybe ought to consider this more of an opportunity for a story than an investment."

So not only was I being accused of sending my mates up the river, but also of missing a story on my doorstep. To make matters worse, he had copied his snotty remarks to everyone on the list. If he had sent it to me alone, I would have been tempted to ignore it, but now there was no option but to respond. I told him - along with all the poor recipients who were probably sick of the whole story by now - that there is a world of difference between a convicted fraudster and an entrepreneurial Irishman battling with French banking bureaucracy while looking for mezzanine financing. If there is a story here, it is about the duplicity of French banks, who lend only to those who have money.

My Irish pal was rather less amused, pointing out that 20 per cent is pretty much the industry standard. "Please tell me he's not a business journalist," he said. I couldn't disabuse him. However, the e-mail writer has been covering Wall Street, where everyone is a hero until the former chairman of NASDAQ turns out to be running a US$65 billion (Dh238.76bn) Ponzi scheme. Having missed the story on his doorstep, now he thinks everyone is a villain. But that's Wall Street, unable to distinguish between black and white unless it's behind bars.