POLICE are looking into claims by traders at the Galtres Festival that they have been left up to £125,000 out of pocket, as the event’s organiser appoints administrators.

North Yorkshire Police has confirmed it is working to establish whether any crime has been committed, as traders wait to receive payments for goods they sold at the three-day event in August.

Around 40 traders estimate they face shortfalls totalling £125,000 and they are unhappy plans are underway for next year’s event, while they await money for this year’s.

Some say they are struggling to survive, as the result of the cashless payment system at the festival, held at Duncombe Park, Helmsley.

A statement on the festival website on Saturday said Galtres Festival Trading Ltd had now been placed in administration and a meeting of creditors was being organised to formalise voluntary liquidation. It said the company had significant liabilities, namely loans to the company, trade creditors including caterers and stallholders, and sums owed to staff and performers.

It added: “We welcome the investigations into the festival business, which we are confident will exonerate us and allow us to move on. We are voluntarily opening our books and records to the police so they may establish no wrong-doing has taken place.

“Similarly the insolvency process, which we have instigated, will involve a thorough investigation into the financial management of the business and the conduct of the directors.”

Festival-goers used payment cards preloaded with money, so no cash changed hands at stalls. Traders’ contracts with the event organiser Galtres Festival Trading Ltd said they would paid within a week of the festival.

However, with payments still outstanding, Galtres Festival Trading confirmed on September 12 that its board had decided to cease trading. It has appointed business recovery specialists Chamberlain & Co to handle the liquidation.

Francois Strydom of Helmsley-based Fat Chef Company, which sold pork sandwiches at the event, says he is £5,000 out of pocket and will need a year to recover.

He said: “I only started my business in January so to take a hit this big as a new company has put me in a pretty scary situation.”

James Houston, the only named individual director of Galtres Festival Trading, would not confirm how much is outstanding, how many traders are owed money, or where the money from the cards has gone. He did tell The Press the company had breached its original contracts with traders stating: “We hope there will be an opportunity to resolve the breaches.”

The online statement said Galtres gained an excellent reputation as a high quality event, but said: “Bewilderingly, despite the highly positive feedback, attendances did not grow at the required rate. It would be hard to question the quality of the event, which has been said by media and attendees to rival the likes of Glastonbury, but despite that it didn’t generate the sales it deserved and needed.

“We are deeply sorry to those individuals and businesses affected by this situation. We know hardship is being experienced as a result by several traders, staff, suppliers, contractors and others. We genuinely strive to support local businesses through the way we run our event, so are all the more distressed to see the opposite effect taking place in some cases.”

Traders are angered further by moves by Mr Houston and The Galtres Festival Charitable Foundation, the other listed director of Galtres Festival Trading, to promote the 2015 festival.

Ben Ahmed, who runs Fuel Coffee Cart, said: “How can they say they are forging ahead with plans for 2015 without paying the creditors for this year’s event?”

He said he had no confidence next year’s event would succeed.

The Galtres online statement said organisers had to meet the Duncombe Park estate but said: “As things stand it’s all systems go.”

The statement said the festival was organised after a thorough analysis of performance figures, projections and costs and several people close to the business had injected personal funds.

A Nationwide Caterers Association spokesperson said: “Early indications suggest at least one catering company will now go out of business while others will struggle with the thousands of pounds worth of debt they have had forced upon them.”

The NCA is offering its legal advice line to affected traders.

The festival team has suspended its social media platforms, citing defamatory comments and a lack of resources to moderate posts.