Unpaid pensions, directors quitting, but Open Money ‘weeks away’ from rescue deal

The future of Manchester-based fintech OpenMoney is again on a knife edge as the new owners seek to secure funding for the business. 

Chief executive Patrick Leahy told TheBusinessDesk.com that he and Will Mallard are confident funding can be secured and that unpaid staff pension contributions and payments to HMRC will be fulfilled.

“The underlying business is sound, the biggest problem is the top co (OpenMoney Limited). It was also overly staffed in the subsidiaries as well. So we have now right-sized the subsidiaries and are just about to finalise the process with the top co.  

“Once that’s complete, new investment will be coming into the business. But no one’s going to invest in the business in the shape it was in,” he said. 

Patrick Leahy

Asked where the investment was coming from he said: “sources close to us”.

He added: “We will be able to provide a good regulated service to the underserved. And we are just weeks away from resolving this to being able to move forward.”

Leahy acknowledged that staff hadn’t been paid and that pension contributions hadn’t been made and that he was in contact with “the regulator and HMRC” regarding payments to staff.

Reminded of his legal duty to pay salaries and pensions, he replied:  “We have a legal duty to pay lots of people. We are shaping the business to ensure they are all paid.”

Two former staff members had reacted angrily to a LinkedIn post from WorkLife OpenMoney which offered pensions advice, claiming they were still owed pension contributions themselves.

Leahy said: “There’s quite a lot of people who are losing their jobs and are quite disgruntled about that. Which is fair enough. There have been lots of people who have not been paid. The vast, vast majority were not paid before we took over the business.”

Leahy and his business partner Will Mallard took over the loss making OpenMoney ending co-founder Anthony Morrow’s last ditch efforts to find a buyer for the company after main funder Duncan Cameron turned off the money tap.

Leahy is also a Director at DeepInspire, a fintech company providing software product development.

Prior to their ‘rescue’ in May, OpenMoney was losing £600,000 a month but earnings were just £1m a year.

The slimmed down OpenMoney will concentrate on providing regulated financial advice, the new owners have claimed.

The business is now located in Elliot House on Deansgate in Manchester city centre as a tenant of Greater Manchester Chamber of Commerce.

In April the senior management team of Michael Davis, Symeon Breen and Leanne Williams all filed their resignations from OpenMoney Limited.

Non executive director Andrew Appleyard, a seasoned financial communications expert, quit the board of OpenMoney Benefits Limited last week.

Contacted by TheBusinessDesk.com he confirmed he had resigned from the board but declined to comment further.

Leahy confirmed that Appleyard has left the business: “He was a non executive director and his contract came to a natural conclusion,” he said.