Father of Tory donor faces ruin over £10m debt guarantee to son

Investigations Editor

Sunday 2 September 2012

THE father of a bankrupt tycoon who poured money into the Scottish Conservatives has been sequestrated after he tried to meet his son's debts.

Malcolm Scott donated at least £1.6m to the Scottish Conservatives before being made bankrupt Photograph: Steve Cox

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EXCLUSIVE by Paul Hutcheon

Malcolm Scott's 76-year-old father David, who was a successful businessman in his own right, has been financially ruined after he underwrote £10 million owed by his son.

Scott Jnr was in recent years the single biggest contributor to Tory coffers north of the Border.

The grain and property tycoon, who was also Scottish party treasurer, donated at least £1.6m and was tipped for a peerage. He also allowed Foreign Secretary William Hague and Prime Minister David Cameron use of his private jet.However, Scott's businesses hit trouble earlier this year after he failed to repay millions of pounds borrowed from banks.His companies were put into administration and he was sequestrated, the Scots term for bankruptcy, owing over £4m.However, Scott's family members are now also paying a price for the business failures.The Old Fettesian's father last year gave a £10m "personal guarantee" over his son's obligations to another company.The same firm petitioned Edinburgh Sheriff Court for David Scott's bankruptcy, an order that was granted in July.The pensioner's total debt stood at £8.7m, and the sequestration is expected to last for a year.A business expert told this newspaper that David Scott was a renowned tycoon in his day. The insider said the father had bequeathed a profitable business to Malcolm Scott, but alleged that he had turned it into a failed enterprise.Scott's 74-year-old mother Florence is also facing bankruptcy. She awaits her own sequestration hearing this month, after providing her son's creditor with a £10m guarantee in January.Official documents list the parents' address as a six-bedroom home in Edinburgh's upmarket Barnton area.According to the Registers of Scotland, ownership of the property changed hands last December from the Scotts to a newly created firm called Barnton Trustees Ltd.This company then took out a standard security from Investec Bank (Channel Islands) Limited, which has a Guernsey address.Labour MP Graeme Morrice said: "Along with the creditors who are out of pocket, it now seems that Malcolm Scott's father has also fallen foul of the way this former Tory donor ran his businesses."He added: "The Conservative Party must be frank about its links to Malcolm Scott and give an assurance he will remain out in the cold until his creditors have received their money."An SNP spokesman said: "It's very sad that the Scottish Tories' former treasurer and major donor has now dragged his father down with him. The longer the Tories stay silent on how Mr Scott conducted their own financial affairs, the worse it looks for them."A spokesman for the Scottish Conservatives said: "Malcolm Scott is not involved with the Scottish Conservatives. These are private matters for him and his family."Neither David nor Malcolm Scott could be contacted for comment.

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Father of Tory donor faces ruin over £10m debt guarantee to son

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