Liquidators in Ethos Global pile up seem to be out of their depth. Crowdcube shareholders have been left out of pocket with the lights off.
Ethos Global is one Crowdcube's worst scandals. Around £800k was invested via the platform, spent by the company before the company was closed down via a compulsory liquidation. The money spent went to open a new facility which is now run by the same people under a new name.
Documents we have seen state that Ethos has a called and paid share capital of £6,885,526 and had overall liabilities of £7,864,430. These are from the official receivers office.
We cant find any documents to support this level of equity invested in the business. Including the Crowdcube fiasco, we estimate that no more than £3m was invested into the company's share capital. And to be frank we doubt the documents filed by the company have any veracity.
In the same documents, it states that the Ethos' founders had given a figure of £50k for the company assets. Now given that most of the £800k Crowdcube cash went into opening a new yoga centre in London, this seems very small. Of course we all know that the founder has moved ownership of this new club to his newco Soma London England. A move that by itself should be earning him some jail time.
What is yet to be fully explained is why Crowdcube allowed this company, who were already in dispute with their Cambridge studio landlords before the Crowdcube campaign, to get anywhere near to investors. Cambridge, billed in the pitch as the cash cow for the business, closed shortly after the Crowdcube campaign succeeded.
And guess who pulled the plug on the company. Yup - the Cambridge studio landlords took this to court and had the company closed down.
The founders have promised Crowdcube shareholders new shares in Soma, now the operating name given to the London studio. But nothing has happened. Shareholders we have spoken to have had no advice from Crowdcube or the company and have come to us for help. The liquidator has been on the case since July and has achieved nothing.
That is simply wrong.