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April 2019

OurSpace Flop

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Last week Kevan Halliwell presented his latest rescue plan – the OurSpace flop. As it turned out it was a complete waste of everyone’s time. As you will see below, Kevan Halliwell didn’t even check with the administrator of OurSpace Investments Ltd (“OIL”) whether his plan was feasible. The administrator has blown it out of the water. If Mr Halliwell had bothered to check he could have saved everyone a lot of time.

For those who missed Kevan Halliwell’s conference call it was the same old story. The points Mr Halliwell wanted to get across were:

  1. OurSpace can rise from the ashes. He is the man for the job but he needs $2.5m to buy the shares of OurSpace Investments Ltd;
  2. The assets are under threat and investors could lose everything if they don’t pay him. Investors need to act fast;
  3. The people who do pay him will get 47.4% of the shares in OIL. The people who don’t pay him will share only 2.5% of the shares in OIL. Kevan Halliwell will own 50.1% and will have complete control of OIL.

He did make some interesting statements which were:

  • Kevan Halliwell says he will never be liable to repay investors. This was in response to a question asking if he had any personal liability. We disagree with his view. We believe he is liable to compensate investors;
  • There never was a bond issue despite this claim being made in the promotional material;
  • OVL had signed a contract to invest a further $286m but did not go through with it;
  • OurSpace was “starved of cash from day one” – his words. This is interesting because had investors known this was the case they would not have invested. Indeed, all the promotional material was focused on how well the company was doing from day one;
  • It was “not possible to pay investors from just two sites” – his words. If that was the case why did he keep selling workspaces and debentures without warning potential investors that it would not be possible to pay them from the operational sites ?;
  • Cashflow is very poor and the companies cannot continue trading on an insolvent basis. This would surely suggest that the risk of failure in his proposed new structure is very high, yet Mr Halliwell is asking investors to invest more money.

We thought it would be wise to check some of the comments made by Kevan Halliwell with the administrator of OIL. The administrator confirmed that Mr Halliwell’s new proposal was simply not possible. We therefore question what Mr Halliwell was trying to achieve. Kevan Halliwell made the statement that OVL were intending to invest $286m in OurSpace. It is our view that a company with that kind of money is likely to hold the OurSpace companies, and Kevan Halliwell himself, liable for their loss of $2.75m. We would expect them to be considering legal action against Kevan Halliwell for misrepresentation and obtaining money by deception. That might explain why Mr Halliwell is keen to raise more money from investors. It would be expensive defending himself from that allegation. The reply we received from the administrator of OIL was:

I cannot comment on the proposal that Mr Halliwell has been offering investors, save for the fact that, from the perspective of the administrators, selling the shares in OIL or creating a debt for equity swap in OIL will not work.

I have therefore made clear to Mr Halliwell that any proposal can only be to purchase the entire share capital of the Dubai operating company and any equity split as between investors/stakeholders should therefore either be a division of shares in the Dubai operating company itself or, more likely, in a new holding company incorporated to acquire and hold the entire share capital of the Dubai operating company.

In other words, the entire proposal by Kevan Halliwell is another attempt to encourage investors to send more money to a structure that will not succeed. We wonder why Mr Halliwell isn’t offering shares in the Dubai operating company. Could it be that shareholders in that company are entitled to receive company accounts which would reveal where all their money has gone ?

We would recommend that any investor considering investing in any new scheme proposed by Kevan Halliwell should insist upon seeing the full and detailed accounts of the Dubai operating company. Kevan Halliwell has never explained to investors how $30 million could just disappear.

To view our previous blog post relating to the Ourspace Flop please click HERE

OurSpace Trickery

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This week Kevan Halliwell was up to his usual Ourspace trickery. Yet another dishonest offer to investors designed to enrich himself.

First of all he tells investors that if they send him more money they will be buying an asset that is at a massive discount to the book value. He fails to inform investors that the true value of the asset is actually close to the valuation he has put on the newly restructured company and that there is no genuine massive discount. Even at the low price nobody is stepping forward to buy these assets.

We describe the new organisation as being “his” because Halliwell is offering investors an initial 49.9% and is keeping 50.1% for himself. The reason is so that he retains control of the money and investors do not have a say. He has a history of losing investors’ money and it would be unwise to think that he actually has any business acumen. He likes 5-star hotels and fine dining using other people’s money.

Is it fair that Halliwell has more than 50% of the new company ? NO – IT ISN’T.

The administrator’s report provides interesting reading. It shows the list of creditors of OurSpace Investments Ltd (“OIL”). Remember that Halliwell is claiming that OIL owns the only assets of the entire group. Halliwell is shown as a creditor of the company. In the event of any payout from the sale of the assets Kevan Halliwell is entitled to 2% of the money paid to creditors. Yes, that is correct. His investment level, compared to that of everyone else, only entitles him to 2% of the money from the administration. Yet here he is proposing a restructuring where he would be entitled to the bulk of the money raised by the company if the company were to be liquidated at any point. Halliwell would be entitled to 80% of the money. In our opinion it is certainly possible that this restructured company could suddenly liquidate very quickly if this mysterious partner will not negotiate with Halliwell. Even if the mystery partner did co-operate, these two workspace sites could easily cease trading because they are in a precarious position. Then Halliwell would get 80% of the money.

If you check the latest proposal on page 8 where he gives the two scenarios – Example A and Example B – you will see that in both cases Kevan Halliwell would get 80% of the value in liquidation and OVL would get 20%. The investors who he is expecting to pay a minimum of $2.5m actually receive ZERO from a liquidation.

There is such a thing as a high risk investment. On the basis of what is being proposed by Halliwell and his history of failure we would put the level of risk on this investment as being way beyond the top end of the scale.

The important difference between the existing structure and this new one is that in this restructuring investors would no longer be owed a debt by the company. They would be shareholders. This means that all investors added together in the new structure would be entitled to nothing if the new structure resulted in a liquidation whilst Halliwell would be entitled to 80%. It’s another one of Halliwell’s neat little restructuring tricks designed to benefit himself.

Is what Halliwell saying actually true ? Is there a party who can take the assets of Ourspace Investments Ltd ? On page 6 of the administrator’s report we find this statement below.

Secured creditors: There are no creditors with security over the company’s assets.

So, it appears that the administrator disagrees with Halliwell’s assessment. I think what all investors would like to know is what is the name of this mysterious party which supposedly threatens the assets ? Halliwell describes it as OVL i.e Ourspace Ventures Ltd incorporated in the Cayman Islands, but WHO actually controls that company ? Halliwell knows because he has been dealing with them. He invited them in and it would have been him who gave them security. Why won’t he tell investors ?

Who are these bondholders who are interested in underwriting the $2.5m ? Investors need to be very careful and should take legal advice before they change their circumstances. Exchanging a debt position for an equity position is generally a bad step for any creditor unless they have absolute trust in the management.

Now here’s another interesting outcome that investors should be aware of. This mysterious partner who allegedly threatens the assets is owed, according to Halliwell, $2.75m. All the other investors are owed around $27.5m. This is quite tidy because it shows that OVL’s investment is 10% of the total of $30m. So, what would be the position AFTER the restructuring if Halliwell’s proposal goes ahead. Unbelievably this greedy CEO proposes to cut the investors’ shares by half and give half of their shares to OVL. What happens to Halliwell’s 50.1% – NOTHING. He keeps all of his shares. Investors receive 49.9% at the start but end up with a lot lower percentage at the end with OVL being given a large chunk of their share. Kevan Halliwell is a master of manipulation.

The reality is that Halliwell transferred investors out of workspace leases and into debentures with Malta companies so that he could remove investors’ security over the leases in Marbella and Dubai. He then gave that security to the mysterious partner. He tricked investors into accepting a weaker position by lying to them that they would be better off. We do not trust this man.

Due to the dishonesty of this latest proposal Safe Or Scam and our existing Ourspace investor group will be making an alternative offer to the administrator. It will be far more generous to investors and will involve the total removal of Kevan Halliwell from any position of influence and control over the assets. It will also mean that investors will not have to give up their rights to prosecute Kevan Halliwell and his accomplices to recover their losses. We are still pursuing those people. Anyone who accepts Halliwell’s latest offer is signing away their right to compensation and falling for the Ourspace trickery.

If you are concerned that you may not receive details of our counter-proposal please drop us a line and we will ensure that you are included in the mailing.

To view our previous blog post on Ourspace please click HERE

OurSpace CEO Update

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On 11th April 2019 Kevan Halliwell sent out an Ourspace CEO Update email. He is handing the hat around once again to the poor investors who have invested $30m into his companies. He has turned that $30m into $4m in the space of little over two years through his workspace ponzi scheme. This time he is claiming that unless they give him another $2.5m everyone will be left with nothing. Given Mr Halliwell’s propensity to restructure investments which result in a far worse situation for investors we would urge extreme caution before committing any more money to his ventures. Investors should demand that he provides a legal opinion from a reputable firm to confirm that what he says is true. He is a proven liar seeking only to protect himself from prosecution.

Halliwell’s offer is that investors will own just less than 50% of a new company for the investment sum of $2.5m. Yet again, Halliwell will control the company. That investment would value the new company at $5m. He says “The equity investment is coming to you at a massive discount to the book value of the company assets…..That is simply Kevan Halliwell trying to trick investors. “Book value” does not mean true value. It means that this is a false figure made up by Ourspace to make it look like they have assets worth a lot of money. The administrators who are handling the administration of OurSpace Investments Ltd have said that Ourspace has a book value for the two leases of $25m. That sounds really great, but the administrators have also said that they expect to be able to sell those leases for only $4m. The leases are worth $21m less than the book value claimed by Ourspace. This latest email from Kevan Halliwell is carefully worded to avoid any mention of the true value of the leases.

Does anyone actually trust the word of Kevan Halliwell. He is facing court action in the UK and in Dubai. Another one of his companies, Ourspace (Leeds GS) Ltd, was recently forced into liquidation by its creditors. They are facing losses of around $1m and there are no assets whatsoever to show for that money. This is in addition to the $30m lost in the other sites.

We would expect the bulk of the $2.5m he intends to raise to be used to defend himself from legal actions. Before he raises any more money he should explain to investors how he has blown more than $30m of their money with only two leases valued at $4m to show for it.

binary option scams

Phenco Oil

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An update to Phenco oil investors was sent out by Martin Finch on 4th April 2019. In brief it said [paraphrased]:

Chainbox Technology has been contacted by several shareholders and Safe Or Scam. As a result Chainbox has decided to withdraw its services for the time being.

Martin Finch now has to start from scratch finding a company solely geared to distribute payments to a large number of shareholders for as little fees as possible.

There then followed a paragraph about progress at one of the sites, along with some photographs. We aren’t interested in that aspect because we would remind investors of three oil investments in Illinois which were established and sold by UK companies between 2012-2014. Those investments were:

Rocky Point Energy  /  Armadillo Energy  /  Hockley Energy

All three of those investments provided investors with photographs of progress. They also welcomed investors to the well sites to see for themselves. Unfortunately none of the wells in the photographs and none of the sites were actually owned by the companies. They were scams.

We are not saying that the photographs provided by Phenco oil are fake. The fact is that nobody knows. The history of previous US oil scams proves these things are easy to fake. What is not in doubt is the fact that Mr Finch has taken in around £15 million for five oil companies and yet shareholders know absolutely nothing about the US companies involved or where most of the £15 million went. All we do know is that the money didn’t go into the purchase of assets.   

In our contact with Chainbox Technology we described the fact that the five oil companies had used Jade State Wealth to make payments. We described three known scams which had also used Jade State Wealth. One is in administration and two are in liquidation. One of them is the subject of a fraud investigation and we fully expect the other two to also become the subject of fraud investigations. We asked the owner, Mr Spurling, to provide us with reassurance. Our request is copied below:

I am writing to ask for your assurance that you have checked out the source of funds paid out to shareholders in all five [oil] companies and you can emphatically verify that neither yourself nor any of your companies are involved in illicit transactions or money laundering. We will post your reply online.

Whilst you may feel that it is acceptable for 70% of a new shareholder’s investment to be paid out in fees and commissions, we do not. We regard that as a scam.

Mr Spurling did not respond. However, Mr Finch did respond even though we did not write to him. His response was that we should leave Chainbox alone.

So now it appears that Mr Finch does not have “a platform” to make the payments to shareholders. We have a solution for him. He could use a company called PHENCO LTD.

Hundreds of thousands of companies in the UK manage to make payments to their shareholders so why can’t Phenco oil itself make the payments ?

The last filing on the register at Companies House shows that Phenco has 194 shareholders. That is not a large number. Payment can be done very easily in one day. Most UK bank accounts allow multiple payments to be made online via bank transfer. Even with “a platform” Mr Finch has to provide the platform with the bank details of every shareholder and he has to tell the platform how much to pay each shareholder.

It’s very odd that Phenco can produce royalty statements for every shareholder showing the percentage and amount they are owed, but can’t then press a few buttons and make the payment. Surely having to give all the information to a platform is much more time-consuming than Phenco just making the payments itself.

Mr Finch’s excuses do not make sense. It appears that he goes to great lengths to ensure that shareholders cannot trace the source of the payments. He uses offshore currency exchange services and then a payment distribution provider. Although his UK companies allegedly have the contracts with US counterparts the royalties are never paid into the bank accounts of the UK companies. That is a very strange arrangement which raises questions about money laundering and the tracking of payments.

Mr Finch is the only employee of Phenco Ltd. He could process the payments in one day. If he did it himself he would save the company a lot of money.

So there is the solution. Phenco Ltd could pay its own shareholders from its own UK bank account.  

To view the next update on the Phenco oil scam please click on this link.


European Property Coin – 6

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We are pleased to announce that, at a hearing in the High Court in London on 27th March 2019, the Judge granted a winding up order over Clear View Marketing Services Ltd, the operator of the scam digital currency known as the European Property Coin.

Over the past year Safe Or Scam has attracted enquiries from more than 50 investors who purchased these fake coins. We worked closely with two investors to have their debts recognised by the UK courts and then to progress their cases through the UK legal system so that they could make an application to wind up the company.

The criminals behind Clear View Marketing Services (trading as Clearview Trading) knew this was coming. They proceeded to declare themselves as being in liquidation and they advised investors to deal with a fake liquidation company. That fake liquidation company was called Asset Recovery Network. There is a genuine company called Asset Recovery Network (UK) Ltd. We spoke with the director of the company and are satisfied that the crooks were just using their name. The director has since filed a report with the Police and we are helping them with their enquiries into the follow-up scam.

The people behind the fake Asset Recovery Network advised investors that their coins had been sold and they had made a substantial profit. It is the usual follow-up scam where they ask investors to pay a fee in order to release the money. Once that fee is paid the money never arrives.  

When a company is wound up the Official Receiver, a UK government department, is appointed to handle an investigation into the company’s affairs. The Official Receiver has the discretion to appoint another licensed insolvency practitioner to take over the investigation. We have proposed to investors that they consider requesting the OR to appoint a third party liquidation firm which has more substantial resources than the OR, including a forensic accounting team which is likely to be needed in this case. We have now identified 32 UK bank accounts used in the scam.

The chances of recovery are not great. However, these scams cannot be established without the support of sales agent companies, accountants and banks. If the insolvency practitioner suspects collusion in the fraud or unjust enrichment he can demand the repayment of those sums and recommend a prosecution to the Police. We will be looking closely at the legal rights for confiscation of assets. The 32 bank accounts will also bring some of the crooks out into the open for criminal charges so we are hopeful that some of the money can be recovered.

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