MFS runs out of solutions

Raja: The situation at MFS is a technical and procedural impasse.

THE walls of Market Financial Solutions Ltd’s (MFS) London offices were a shrine to the passions of founder Paresh Raja. 

There were autographed cricket bats, boxing gloves used by Mike Tyson, Tyson Fury and Anthony Joshua, Olympic torches and signed albums by Pink Floyd, according to sources and photographs seen by Bloomberg.

On display were framed football jerseys, seemingly signed by stars including Lionel Messi and Karim Benzema. One vintage Argentina shirt was simply autographed: “Diego.”

Yet when court-appointed insolvency officials arrived at the UK property lender’s London offices last week to take over after the firm’s collapse, the walls were largely bare, according to the sources.

Raja too has withdrawn from public view, with his whereabouts one of many questions surrounding the sudden unraveling of MFS last month – a collapse that has reverberated across Wall Street and the global financial sector.

One of the sources says Raja is in Dubai.

Two creditors that forced the firm into administration, a form of UK insolvency, have alleged that £238mil of money that should have been earmarked for repayments is missing.

They also warned that there may be a £930mil shortfall in collateral backing their debts as a result of so-called double-pledging of assets – when a borrower secures multiple financing facilities from different lenders using the same collateral.

“If ‘double pledging’ and ‘diversion’ of borrower repayments as alleged by the creditors are true, they could indicate weaknesses in internal oversight and potentially criminal conduct,” said Nicholas Ryder, a law professor at the University of Cardiff who focuses on financial crime.

“An audit is essential to trace the flow of funds, identify any improper transfers and establish whether senior management, intermediaries or external parties were involved.”

A spokesperson for Raja declined to comment.

His LinkedIn profile is no longer active.

In a recent statement to media, he described the situation as “a technical and procedural impasse” that did not reflect “a failure of the underlying business”.

A spokesperson for AlixPartners, the court-appointed firm overseeing the administration, declined to comment.

MFS offered what it described as “complex, property-backed lending” to customers including short-term debts known as bridging loans.

The firm had grown rapidly, tripling its loan book over the four years through 2025 to about £2.7bil, according to an internal document seen by Bloomberg.

That growth was fuelled by more than £2bil of loans from firms including Barclays Plc and Apollo Global Management Inc’s Atlas SP Partners unit.

Jefferies Financial Group Inc, Elliott Investment Management, Sumitomo Mitsui Financial Group Inc and Banco Santander SA are also exposed. 

Despite its growth, MFS remained barely known outside its corner of finance.

The UK market for bridging loans is about £14bil in size, equivalent to less than 1% of the £1.7 trillion residential mortgage market, data from the Bank of England and trade body Bridging & Development Lenders Association show.

“I’d never heard of MFS before,” says Patrick Corrigan, a law professor at the University of Notre Dame.

“Nor were UK bridge loans on my radar as a nexus for potential risk.”

At its core, a bridge loan is short-term financing designed to tide a borrower over until a more permanent solution can be secured.

The product grew in popularity as traditional banks retrenched, interest rates rose and private credit firms stepped in to fill the gap.

Umang Vithlani, head of credit alpha at Cazadores Investments in London, questioned the due diligence process from MFS’ investors and lenders. 

“Private credit has always had less transparency and liquidity than public,” Vithlani said. “All these led to this situation.”

As MFS grew, its founder spent lavishly on building its profile, on team events and on charity donations, according to sources.

Raja often arrived at MFS’ office in London’s Mayfair district in chauffeur-driven cars, including a Rolls Royce.

He and his wife Tiba spent the year moving between Monaco, Dubai and London, the people said.

Tiba, described on MFS’ website as a founder and executive director at the firm, did not respond to requests for comment.

At a charity auction for Children With Cancer in 2023, Raja bought a Pablo Picasso still-life print for £100,000.

The purchase was “the highest amount raised on a single auction lot” in the charity’s 36-year history.

As MFS grew, so did Raja’s marketing ideas.

In September last year, the firm sponsored Indian singer Arijit Singh to play his first UK stadium show in London’s Tottenham Hotspur stadium. 

MFS is a sponsor of a concert in London by Indian rapper BadShah.

The gig is scheduled to go ahead later this month: Badshah appeared at a recent press conference on front of posters with the MFS logo still visible. 

In December, scores of employees descended on the five-star Peninsula Hotel for a black tie Christmas event, the sources said.

Raja praised the firm’s growth in 2025 while workers watched a pair of dancers perform inside a giant glass dome, according to videos seen by Bloomberg.

Tiba also attended the December party.

In a post on her LinkedIn profile, which is no longer active, she reflected on 2025 as a year of “real highs” and “where growth has been huge” yet added that “not everything went to plan”.

She also praised her husband.

“You have an incredible ability to keep things moving, keep people focused and keep perspective when it matters most,” she wrote.

“Your commitment and energy never dip, even when the pressure is on.”

Weeks before the party, Barclays began freezing MFS accounts, part of a series of events that led to the firm’s collapse, according to sources.

The Financial Times reported early this month that the UK bank began blocking some MFS transactions in November.

The extent of creditors’ losses – if any – remains unclear as AlixPartners officials begin to sift through MFS’ operations. 

In an interview with Bloomberg TV, Santander Executive Chair Ana Botin likened hits from bad loans to stings from “jellyfish on a beach”, adding that “you still go in the water.”

The majority of MFS’ nearly 200 workers have lost their jobs.

On group WhatsApp chats seen by Bloomberg, images of Raja created by artificial intelligence (AI) portray him hiding behind a flowerpot with the Dubai skyline behind him, or as a cockroach – an apparent reference to the JPMorgan Chase & Co chief executive officer Jamie Dimon’s warning about the risks lurking in private credit. 

An AI-generated rap song about the collapse has also been shared among former MFS employees. 

“Now the whole empire under review, why?,” go the lyrics.

“Administration order, assets freeze, creditors down on one knee.” — Bloomberg