David Elias: the man behind missing Keydata money

David Elias, the controversial former business associate of Ernest Saunders, Lord Rothschild and Daily Express owner Richard Desmond, has emerged as a key figure in the collapse of Keydata Investment Services.

Dan Schwarzmann, a partner at PricewaterhouseCoopers, Keydata's administrator, told Citywire Elias was the main shareholder and the driving force behind SLS Capital, the firm dealing in life settlement funds, from which £103 million of Keydata investments has disappeared.

Elias, who died in May aged 54, lived his last years in Singapore after eluding a warrant for his arrest in connection with inquiries by the Official Receiver and the Serious Fraud Office into the collapse in 1997 of Richbell, his business empire.

Elias was responsible for creating SLS Capital and promoting it for investment via bonds to the UK. It is understood SLS Capital was sold in an unregulated form directly to individuals paying out a yield up to 9%, but was also sold through an ISA wrapper via Keydata.

A source close to Keydata directors confirmed to Citywire: 'David was the man behind SLS, the Malaysian based company that put together the first three life settlement products.'

At this moment in time it is unclear what exactly was Elias' role in the disappearance of the money, but he had a colourful past and a turbulent career.

Elias amassed a fortune in the 1980s through a loyalty reward scheme in petrol stations and based his business in Ireland for tax reasons. In the 1990s he merged this business with its US petrol card rival to form H-G Holdings and entered into a joint venture with Richard Desmond, the owner of the Northern Shell group. Their plan was to build a publishing empire by leveraging off their petrol station network as a distribution point from which they could sell magazines to business men and lorry drivers.

Elias and Desmond embarked on an expensive marketing campaign for their flagship title, Breaking The Mould, and a series of top-shelf magazines such as Megaboobs and Suburban Housewife.

Soon afterwards Elias acquired a £30 million loan from Lord Rothschild's investment group, RIT, for Richbell. It was never clear what the association between Richbell and H-G Holdings was but when RIT asked for the loan to be returned, it appeared the money had gone missing. RIT and other creditors sued, prompting the collapse of Richbell.

Elias counter-sued claiming the creditors and Ernest Saunders, the former Guinness chief who had chaired Richbell's executive committee, had attempted to ruin the company in order to gain control of H-G.