TrustBuddy jolted the peer to peer lending world as “suspected misconduct” compelled the platform to shut down operations last week. Now the firm has publicly stated it can no longer operate in any form, forcing the company to file for bankruptcy as the situation is “increasingly complex.
An audio webcast is scheduled for later today to explain the situation to shareholders. Bot the Chairman of the Board Simon Nathanson along with CEO Philip Mikal and Lars-Henrik Andersson, appointed by the bankruptcy court, will present background information and discuss the process of moving forward.
TrustBuddy had been struggling to reorganize its operations to move away from a “payday loan” type lender to one more focused on consumer lending. The board had brought in new management that apparently uncovered a 44 Million SEK ($5.4M) discrepancy. he misconduct was said to be “likely in place since the TrustBuddy platform began operation”. TrustBuddy was a publicly traded entity.
Following the revelations Swedish authorities forced TrustBuddy to cease operations. Swedish police were contacted to conduct a criminal investigation.
The statement released by the board of directors, is republished below:
Further investigation has revealed that the situation is increasingly complex and it will not be possible to continue operations in any form. The Board of Directors concludes that the company is insolvent. To ensure fair treatment of all stakeholders, the Board of Directors, with great disappointment, has decided to file for bankruptcy. The District Court in Stockholm has appointed Lars-Henrik Andersson of Lindahl law firm to handle the process going forward.
The services of the company will continue to be closed, and the trading in the share will not be resumed.
Simon Nathanson, Chairman of the Board of TrustBuddy AB, comments:
“As a result of the misconduct, our ongoing discussions with stakeholders, lack of liquidity and inability to operate a regulated operation, TrustBuddy cannot move forward with the business. Today’s decisive action will give all stakeholders the opportunity to receive fair treatment in a structured process. The Board of Directors and management will continue to support the process going forward in any way we can.”
Lars-Henrik Andersson, Lindahl law firm, comments:
“My immediate focus will be to fully understand the critical questions of the business in order to find the best way to safeguard the interests of the creditors and other stakeholders. One action is to immediately take control over all assets of the company. I am looking forward to an efficient cooperation with the current board and management of TrustBuddy.”
To participate in the audio webcast, today, October 19th, at 13.00 CET, and have the opportunity to ask questions, please dial the following number: +44 (0) 1452 567058, pass code 1929786.
The webcast will also be available on http://engage.vevent.com/rt/webcasting~20151019.