> Private-Credit Blowup Leaves $1.7 Billion Missing, Six Ferraris Found

U.K. mortgage lender Market Financial Solutions left Barclays, HSBC and Apollo Global Management facing hundreds of millions of dollars in potential losses when it collapsed in February.

Now, bankruptcy administrators allege its owner, Paresh Raja , moved around $550 million of MFS-borrowed funds into personal bank accounts and then bought luxury cars including six Ferraris and three Rolls-Royces.

In total, lenders provided around $3.5 billion to MFS entities but administrators said they could only verify around $1.6 billion in actual loans made by the entities, plus cash balances of around $233 million. They allege the remaining $1.7 billion was misappropriated by Raja.

Barclays recently wrote off around $310 million of its $680 million exposure to MFS, while HSBC took a $400 million charge last week over loans it made to Apollo’s Atlas SP Partners unit to buy into the deals. Atlas has said it has around $540 million in exposure. A spokesman for HSBC declined to comment, and Barclays and Atlas didn’t immediately respond to requests for comment.