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Free Wi-Fi Supplier, Gowex, Files For Bankruptcy
PuceBaboon writes "The BBC is reporting that a Spanish firm, Gowex, which provides free Wi-Fi services in major cities world-wide, has filed for bankruptcy, following revelations that financial accounts filed over the past four years were "false". The company supplies services in London, Shanghai, New York and Buenos Aires, as well as Madrid. Other sources report that up to 90% of the company's reported revenue came from "undisclosed related parties" (in other words, from Gowex itself) and that the value of the company's share price was now effectively zero.
That's what people are told when they want to build a startup. It is legendary that a famous auction site started with an inventory of items that had been highly inflated by employees. Giving new customers a free ride while pretending that they're full paying customers to others seems to be a common strategy. So what do you expect to happen when you "don't make it"? This happens.
This isn't at all unusual. However, what really gets my goat is how were they allowed to do what they did for four years?
That's four years of some accountant falsifying accounts. Four years of tax not paid or properly checked (if they were earning what they claim, a lot of tax would be due - if they were lying about it, they'd not want to pay that tax). Four years of operating without anyone questioning.
And, most importantly I feel, what's happened to the directors and accountants of the company now ( I highly doubt just one person was in knowledge of this)? My guess is that they've already fled with a nice bundle somewhere.
Happened like mad to the software houses in the 80's, still going on. Why is it compulsory that I have to be sat down like a child when I want to take out a £1000 loan but nobody questions businesses or enforces them to give enhanced accounts or audits in their first few years of operation. It would stop an awful lot of such outright fraud as this if someone from government was poking through their accounts, and they wouldn't even be able to set up a "new" company, transfer the assets and then declare bankruptcy as is also common.
Other sources report that up to 90% of the company's reported revenue came from "undisclosed related parties" (in other words, from Gowex itself)
I hear the NSA likes to invest in internet infrastructure and technology, and not even take the credit. Maybe they're the undisclosed party.
Don't waste your vote! Vote for whoever you want, unless you live in a swing state it won't matter anyways
The report includes this tidbit:
CEO Jenaro Garcia was a Director of Advanced Refractive Technologies, a penny stock fraud whose shares were revoked by the US Securities and Exchange Commission.