Paresh Raja, the former chief executive of Market Financial Solutions (MFS), has criticised what he describes as internal conflicts between insolvency practitioners handling the fallout from the mortgage lender’s collapse. In recent court filings, Raja said he is facing multiple parallel legal proceedings—five currently underway, with a possible sixth—originating from different parts of the MFS group.
Raja claimed the various MFS entities are pursuing largely overlapping claims for sums involving similar alleged breaches, but have made no effort to coordinate their actions. His legal team described the situation as marked by “internecine warfare,” which they argue has led to harassment through a series of urgent applications across multiple legal forums, as each entity appears to be trying to secure priority over the others.
MFS, a mortgage lender that collapsed in February after Barclays froze its accounts, is at the centre of one of the most complex insolvencies in recent UK history. The group comprises more than 200 related companies, with numerous insolvency firms involved in managing the process. The collapse has exposed significant losses for a range of investors including Wall Street and City financial institutions alongside private investors, sparking broader concerns over private credit market standards.
A global asset freezing order valued at £1.3 billion has been placed on Raja, who is accused of misappropriating substantial funds from the group. Administrators from AlixPartners, involved in MFS’s insolvency, have alleged “systematic plundering” by Raja. Separately, administrators from FRP, overseeing entities including London Bridging Limited, have accused Raja of extracting “vast sums” by allegedly securing debt against the same properties multiple times—a practice known as “double-pledging”—which they say contributed to a significant shortfall in recoverable assets.
London Bridging has filed a claim seeking £242 million from Raja for alleged misappropriation, though it intends to reduce this figure to £51 million. An application for summary judgment, a legal procedure to resolve the case without a full trial, is scheduled for December. Raja denies all allegations of misappropriation, dishonesty, or breach of director duties. He argues that the multiple proceedings are duplicative and seeks a case management hearing under a single judge to coordinate the various claims and prevent further “harassment.”
London Bridging supports the consolidation of case management but wants its summary judgment application to proceed before any wider hearing. FRP declined to comment on ongoing litigation or related allegations. The unfolding legal disputes highlight complexities and competing interests in one of the UK’s largest and most intricate corporate insolvencies to date.