It’s a shocking tale of undeclared, unsecured loans made by Dave Whitby from the coffers of the then CEB AIM listed company, which recently rebranded to Andalas Energy & Power (LON: ADL). Whitby, who is the CEO of Corsair Petroleum, a private Singaporean company, took control of CEB/ADL on June 5th 2015, on that day he also took control of £1,500,000 of placing cash raised at 0.4p. Within days he had secretly signed off $475,000 in undeclared related party payments in unsecured loans. If you think that is shocking, read on and discover who the unsecured loans went to.
I call upon AIM Regulation to immediately investigate Andalas Energy & Power PLC and it’s disgraceful CEO, the $600,000,000 fantasyman Dave Whitby for accounting FRAUDS he should be suspended forthwith! Their Nomad, Cantor Fitzgerald, Miss Sarah Wharry, (Worry) has been informed, as have the AIM Regulation Team and the FCA Market Abuse bods.
This is how it went.
On 10 June 2015 Whitby CEB/ADL issued Whitby/Corsair (Yes himself & his Corsair mates) with an unsecured loan of $250,000. The loan was to bear interest of 5% per annum payable on repayment of the loan. Full repayment of the principal amount plus accrued interest was to be made by 10 June 2016.
On 15 July 2015 Whitby CEB/ADL issued to Whitby/Corsair another unsecured loan of $225,000. That loan also carried interest of 5% per annum payable on repayment of the loan. Full repayment of the principal amount plus accrued interest was to be made by 15 July 2016.
Those payments are related party transactions and were never disclosed to shareholders or the market at the time they were made. Just how much of the $475,000 Whitby and Simon Gorringe, who is also on the board of Corsair and the gravy train at Andalas, have taken in payments from Whitby/Corsair is not known. However any payments made by Whitby/Corsair using Whitby CEB/ADL unsecured loan cash must be yet more related party transactions and subject to full RNS disclosure. Nothing, zippo…
The reason Whitby/CEB/ADL gave Whitby/Corsair unsecured loans is quite simple. Corsair haven’t got a pot to piss in and haven’t got any asset/s of value to secure the loans. It is inconceivable that any financial institution or business would advance approx. $500,000 in unsecured loans at 5%.
The questions are many and myriad but will have to wait until later down in this article because folks it gets even worse!
On the 19 August 2015. Whitby/CEB/ADL incorporated a subsidiary of Andalas Energy & Power, another Singaporean company called Corvette Energy (Singapore) PTE. LTD Company registration number 201532252D. Now you would think that an AIM listed company operating on the London Stock Exchange would have RNS’d such. But nay, there’s no mention of the new Whitby/CEB/ADL/Corvette subsidiary. The first inkling of Corvettes existence is six months later, buried in their half yearly report released on 26/01/2016.
Here’s the killer, we learn that Whitby CEB/ADL and Whitby Corsair have now novated and ‘extinguished’ the Whitby CEB/ADL unsecured loans of $500,000 & the 5% interest made to Whitby Corsair. “On 26 January 2016, Andalas, Corsair and Corvette entered into a novation agreement pursuant to which the Loans were extinguished and the benefit of the loaned moneys was transferred to Corvette with effect from 30 October 2015”. So now the unsecured, undeclared loans have come full circle back to Whitby CEB/ADL/Corvette. The burning question shareholders should be asking is this; How much was returned?
Remember, that according to the 2015 annual report the unsecured loans were made with these contractual conditions “The loans bear interest of 5% per annum payable on repayment of the loan/s. Full repayment of the principal amount/s plus accrued interest of 5% will be made by 10 June 2016 and 15 July 2016. There was no mention whatsoever of the unsecured loans being made for Indonesian Due Diligence. It is only when their repayment looms large is it sneaked out that ‘really guys this was for DD’. That throws up a multipule choice of unanswered questions. How were Whitby Corsair ever going to repay? Maybe they were planning to flood the market with the next tranches of ADL shares, all 93,750,000 going to Whitby Corsair that were to be awarded to them on the signing of an Indo’ deal? Did this plan fall apart during suspension? It’s 8 months after the unsecured loans were made that the repayment goalposts are moved. It is s fraud, compounded by lies!
We learn on the 26 January 2016 that they now were given so that Whitby/Corsair could progress Indonesian due diligence. What a crock of shit. Let’s be generous and say Maybe some of the cash was used but I seriously doubt that all of it was! Are we to believe that Whitby CEB/ADL will force their own ANDALAS subsidiary Corvette, to repay back $550,000 to themselves? When did it change? It’s a sleight of hand. No fooker is paying the cash back because the majority of it has been rinsed out by Whitby/Corsair! What is left is probably a small rump of cash that they once again haven’t RNS’d. These are ALL material transactions that have to all intents and purposes been sneaked out via the back door. They have been deliberately withheld. They are in effect ‘Back door Director loans’ that will never be repaid. Whitby should resign immediately.
The elephant in the room is this? Where has $550,000 dollars gone? Of course we’ll get the usual spin from Whitby, does anyone now really doubt that what myself and Tom Winnifrith, have wrote on this chump isn’t, in light of yesterdays absolute disastrous placing and this article today, bang on? Whitby is a corporate crook, raping his own shareholders to line the pockets of himself and his fellow Aussie crims.
I contacted Sarah Wharry the company nomad, from Cantor Fitzgerald, Sarah hasn’t responded to my questions. I wonder why? It has to be noted that Cantor were not the Nomad at the time of the undeclared, unsecured related party loans. That mantel fell to Sanlam Securities who, intriguingly, no longer provide Nomad services! I personally spoke to several big private holders of ADL stock who were again, unaware. I spoke to two CEO’s. One stated that he “would never put that to my board because it was wrong”. The other said in answer to my question, are these in your opinion related party transactions? Reply; “Absolutely – is a related party transaction and needs independent written advice and an RNS”. Both of these men are respected CEO’s.
I urge shareholders to contact the relevant authorities with the questions below. Make a formal complaint. A full investigation is warranted. Get the $550,000 dollars back. A full forensic account is needed here!
Questions for AIM Regulation, Cantor Fitzgerald and the FCA Market Abuse Team.
1/ Can you please explain why $475,000 in related party payments i.e Unsecured loans, made by the CEO Whitby CEB/ADL to CEO Whitby/Corsair were not disclosed to shareholders and the market at the time they were signed off? (There was never any RNS’s)
2/ Can you please investigate how much of the unsecured loans made by Whitby/CEB/ADL to Whitby/Corsair were paid in fees/expenses to Whitby/Gorringe by Whitby/Corsair?
3/ I understand that these unsecured loans have now, as of January 2016, been novated and moved into a hastily incorporated subsidiary of ADL. (Corvette) why wasn’t this disclosed?
4/ How much money was transferred by Whitby/Corsair to the Whitby ADL subsidiary Corvette?
5/ How much cash did Whitby/Corsair burn through before the residual amount of the unsecured loan was transferred back to the Andalas subsidiary Corvette?
6/ What has happened to these loans now, will they ever be paid back in full as per Whitby stated in the 2015 annual accounts?
7/ The Company has lied to shareholders and the market, isn’t this sanctionable?
8/ Why was there no RNS on the formation of the ADL subsidiary, Corvette? Surly this is an RNSable event?
9/ Why was there no RNS on the transfer of the loans back from Whitby/Corsair to the Whitby Andalas subsidiary, Corvette?
10/ Why wasn’t the novation and extinguishing of the loans plus interest, disclosed to the market and shareholders?
11/ How much of the unsecured loan cash went into the pockets of Whitby/Gorringe/Corsair?
12/ Why was no information ever given to the market that unsecured loans with 5% interest, were part of a due diligence effort?
And last but not least,
13/ Who signed these unsecured loans off and where was the oversight with the written legal advice as to their legality?
It is only in January 2016 some 8 months later, that we are told that; Andalas and Corsair agreed to structure the funding of the due diligence expenditures as loans (“Loans”) to Corsair” This just isn’t credible let alone believable.
It seems to me that this is, to all intents and purposes a fleecing of CEB/ADL cash by the executive and should be immediately investigated.
I put it to shareholders that these unsecured undeclared loans were in effect ‘back door director loans’ which have now been rinsed through two corporate entities coming back to ADL’s Corvette subsidiary minus a large amount of cash originally given to Whitby/Corsair by Whitby CEB/ADL.
Basically chaps where has all the money gone?
NB. This is what they said in their annual accounts: Published 21 July 2015;
On 5 June 2015 David Whitby was appointed as Managing Director and Chief Executive Officer of the Company. David Whitby is a beneficial owner of Corsair. Through his beneficial ownership of Corsair David Whitby owns 7,812,500 shares in the Company which were issued on 4 June 2015. On 10 June 2015 the Company entered into a loan agreement with Corsair to provide Corsair with an unsecured loan of USD 250,000. The loan bears interest of 5% per annum payable on repayment of the loan. Full repayment of the principal amount plus accrued interest will be made by 10 June 2016.
On 11 June 2015 370,000,000 ordinary shares were issued for trading at a price of 0.4 pence per share, raising gross proceeds of GBP 1,500,000. Of these 50,000,000 were subscribed to by Northcote.
On 15 July 2015 the Company entered into a loan agreement with Corsair to provide Corsair with an unsecured loan of USD 225,000. The loan bears interest of 5% per annum payable on repayment of the loan. Full repayment of the principal amount plus accrued interest will be made by 15 July 2016.
This is what they said in their 2016 half yearly report: Published 26 Jan 2016;
On 5 June 2015, Andalas and Corsair entered into an agreement (“Assignment”) pursuant to which Andalas agreed, amongst other things, to undertake and fund due diligence in respect of certain oil and gas concessions in Indonesia with a view to making an investment. Initially, for administrative convenience, Andalas and Corsair agreed to structure the funding of the due diligence expenditures as loans (“Loans”) to Corsair and, accordingly, advances pursuant to that arrangement were made on 8 May (US$25,000), 10 June (US$250,000) and 15 July 2015 (US$225,000). On 19 August 2015, Andalas incorporated a subsidiary, Corvette Energy (Singapore) Pte Ltd (“Corvette”). On 26 January 2016, Andalas, Corsair and Corvette entered into a novation agreement pursuant to which the Loans were extinguished and the benefit of the loaned moneys was transferred to Corvette with effect from 30 October 2015.
Corvette was incorporated on 19 August 2015. There was never any mention in the 2015 accounts of Corvette etc Or what these unsecured loans were made for?!?
Corvette only comes into the picture when the repayment of the loans with interest begins to loom large.
Quite frankly it stinks.