Peter Rank & Sons becomes second building firm in 12 months to deceive banks with gemstone

An East Midlands building contractor faces collapse after a probe into the value of a 拢7.5m sapphire that company bosses used to convince bankers of its creditworthiness.

Peter Rank & Sons, a 拢23m-turnover Nottingham firm, has held the gemstone as an asset on its balance sheet for the last six months of its 26-year history but doubts were raised over its value last month following a tip-off to police by a sub-contractor.

In a case that bears striking similarities with Wrekin Construction, the Shropshire firm that collapsed in June amid doubts about the value of an 拢11m ruby that was swapped for equity when it was bought in 2007, Rank & Sons faces ruin unless it can prove its valuation of the so-called Star of Botswana is genuine within a fortnight. It was provided by jeweller James Rank, the brother of the building firm鈥檚 managing director Peter Rank.

A source close to the situation said: 鈥淵ou couldn鈥檛 make this up. The company鈥檚 banks are kicking themselves that they didn鈥檛 see this coming, especially after the Wrekin case. What you will see now is a lot more banks looking a lot more closely at building companies that use precious stones to raise debt.鈥�

The sub-contractor who tipped off police declined to be named but said his suspicions were aroused last month when Peter Rank appeared on site in a full-length beaver fur coat, Cartier diamond-studded sunglasses, spats and a cane. 鈥淗e was flashing it about. This time last year he rolled up in a white van with his arse was hanging out of his jeans.鈥�

A source at the bank said: 鈥淥n the 14 occasions we contacted Mr Rank and his brother about obtaining an independent valuation we were told they were a bit busy and couldn鈥檛 come to the phone right now. We have no reason to believe they were lying.鈥�

P Rank & Sons was unavailable for comment.

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