The liquidation event of a forex trading firm is set to make investors lose millions of pounds. The firm promised investors up to five percent return on investments per month.
Hudspiths packs its bags
Hudspiths has recently established new ventures in Luxembourg and Dubai. It promised investors to use their money for trading in risky foreign exchange derivatives products which could bear up to five percent per month of returns. Late last year, the company stopped paying returns to its investors and cited banking problems. Later, creditors started the process to wind up the company.
Hudspiths has appointed UHY Hacker Young, insolvency practitioners to oversee the voluntary liquidation process for the creditors. The Swindon-based company is also fighting petition in the High Court by a group of 31 creditors who are owed £5 million. The case is adjourned till June 12. In the meanwhile, Hudspiths has a chance to circulate proposals for the company voluntary arrangement (CVA) with its creditors.
Liquidators recently sent a letter to creditors claiming that Hudspiths has an estimated £7.3 million in the firm’s trading accounts. About £6 million of these funds are placed in third-party accounts. The liquidator commented that it is uncertain about the recoverability of these funds.
What does Hudspiths say?
On the other hand, pictures from the trading platform from November 2018 show that the firm has more than £70 million in funds. The firm’s chief executive Karl Lubieniecki said that the figures actually represent the funds it traded on behalf of some of its larger clients. He also said that at least £50 million had been pulled out of the company in recent weeks. The firm received about £10 million in funding from UK-based clients. He also noted that the other branches of the company would not be affected by the UK business as they work as separate entities. These companies have also cut ties with the US business.
Lubieniecki deleted his LinkedIn account, but earlier pictures of him show that him posing on a luxurious yacht. Land Registry records also show that he bought a six-bedroom neo-Georgian house in Swindon in June 2018. The house was listed for sale recently for £2 million. Last month, Lubieniecki noted that the house belonged to an overseas investor. On another one of his websites, Lubieniecki has been listed as a classic car fanatic who has an ever-growing collection of more than 30 cars.