EXCLUSIVE
Bagel boss Larah Bross has closed her flagship shop in Portobello and admitted customers who donated up to £150,000 in a crowdfunding appeal are unlikely to get paid.
The Edinburgh Reporter revealed last year how Ms Bross put her Bross Bagels Ltd firm into receivership leaving behind debts of up to £1 million. She purchased the assets of Bross Bagels for just £18,000 the day before an official liquidator was appointed then opened up in the same premises under a new company Hot Mama Bagels Ltd.
Small suppliers and unsecured creditors were left in the lurch to the tune of around £280,000 while the largest creditor was HM Revenue & Customs who were due an estimated £635,000 in unpaid taxes, national insurance and VAT.
So called “Shareholers”- loyal customers who donated £1,000 each over two rounds of crowdfunding – were supposed to be repaid after a four year period but any last hope of seeing a return on their money has now disappeared.
Ms Bross, who has been appearing at cookery demonstrations at Foodies Festivals up and down the UK throughout June and July and was pictured at one event with TV personality Peter Andre, claims the decision to close the Portobello business and to step back from operations was due to “a significant toll on my mental health and that of my family.”
The High Street unit has been closed for several weeks and a notice on the window claimed it would reopen on 15 July after the “Trades Holidays” but that did not happen. Meanwhile, the Bross Bagels website – used by Hot Mama Bagels to take orders – has disappeared and the domain is no longer active.
The Edinburgh Reporter approached Ms Bross for comment on 22 July but failed to get a response.
Last night in a message to Shareholers, she said: “It is with a heavy heart that I write to inform you about the cessation of trading at our Portobello location. This decision has not come lightly and is the result of financial and operational difficulties that have proven insurmountable over the past year.
“I have been navigating through substantial personal guarantees and debts stemming from our recent restructuring. The financial strain, coupled with the immense stress of trying to steer the company through these turbulent times, has taken a significant toll on both my mental health and that of my family.
“Despite my resilience and determination, I have reached a point where continuing in this manner is no longer feasible. Prioritising my well-being and that of my loved ones has become imperative, and as difficult as it is, I believe stepping back from operations is the best course of action.
“I want to assure you that the Bross brand will live on. While I cannot promise a return on your investment with Bross Bagels at this moment, I remain committed to finding a way to make it up to you in the future. I am dedicated to exploring all possible avenues to ensure that your faith in Bross Bagels is ultimately rewarded.”
One crowdfunder was unimpressed by Ms Bross’s latest actions. She said: “She has led us up the garden path with flimsy promises that she would make good the debt and repay our faith.
“It jars with me that while her core business in Portobello has been shut for weeks she has been poncing about at these Foodie Festivals doing bagel demos, making her stupid Instagram videos, and taking selfies with so-called celebs.”
An investigation by The Edinburgh Reporter earlier revealed the failed Bross Bagels business had not been paying Student Loan Deductions to Inland Revenue which had been collected from the salaries of staff who had student loans.
The sometime stand up comedian built up a social media savvy business with shops in Portobello, Leith, Stockbridge, Brunstfield and in the prestigious St James Quarter, with a steady stream of celebrities visiting and appearing on videos. All have subsequently closed and it is unclear if the Bruntsfield shop remains trading.
Stephen Rafferty is a former crime correspondent at The Scotsman and was a staff reporter for the Daily Record and Edinburgh Evening News. He has freelanced for many of the Scottish and UK national newspaper titles. Got a story? Get in touch - stephen@theedinburghreporter.co.uk
