Cryptocurrency minibond scheme Viderium has collapsed and gone into administration. MHA MacIntyre Hudson LLP have been appointed as administrators.
Viderium raised £3.9 million (as at December 2018) from bonds paying 9.8% per year for a three year term, claiming “A Rated Indemnity Insurance” on the front page of its brochure.
Whether anything has happened to trigger that insurance is unknown, but I wouldn’t bet on it, given that the insurance covered “any Actual or Alleged act, Error, Misstatement, Misleading Statement, Omission, Neglect or Breach of Duty or loss” and running out of money to pay bondholder returns doesn’t fall under any of those things.
At some point before April 2020 Viderium wrote to investors to tell them that they were going to lose some or all of their money, according to an investor review posted on Feefo. Viderium subsequently scrubbed all its Feefo reviews but left a fragment of that review visible on its website.
The company continued posting regurgitated content to its Facebook page until August 2020. Its Twitter page has, like its Feefo page, been scrubbed.
In August 2018 Viderium wasted investors’ money attempting to legally intimidate WordPress into removing my review. Viderium made no attempt to complain to me directly, effectively an admission that it knew its complaint was groundless.
Viderium complained that my review “made a number of false statements, unauthorised financial advisory statements, inflammatory and defamatory statements and remarks”. It failed to point out anything in my review that was inaccurate, which simply noted the inherently high risk nature of Viderium’s bonds. It also inaccurately complained that I had republished “confidential and sensitive documents”, when in fact my review was based on Viderium’s own investment material which it freely supplied to the public on request.
Astonishingly, Viderium’s complaint also claimed that their investors could not lose their money.
[Quoting my review] These investments are unregulated corporate loans and if Viderium defaults you risk losing up to 100% of your money. [Viderium’s complaint] This is false and misleading information not based upon fact. The publisher has provided incorrect information as advice to the general public. [Quoting my review] If Viderium fails to make sufficient returns from its cryptocurrency mining… there is a risk that they may default on payments of capital and interest to investors. [Viderium’s complaint] This is false and incorrect information provided deliberately out of context in order to purposefully provide a negative view of the company and the prospect of investment into the company.
Viderium’s collapse illustrates that I was right and that unregulated corporate loan notes are in fact high risk.
In another complaint to Google, Viderium claimed that its “investment bond is regulated by the Financial Conduct Authority”. This was also false. While Viderium’s literature was approved by Bluewater Capital, the investment itself was unregulated.
Three of Viderium’s leading staff members, Alexander Johnson, Ross Archer and Russell Spratley, divided their time between Viderium and a new venture launched in 2019, Whiskey Cask Company, which claims endorsement from rugby legend Chris Robshaw.
Perhaps trying to run two unregulated investment schemes simultaneously caused Johnson, Archer and co to take their eye off the ball at Viderium. As and when more details are published by the administrators, it’ll be covered here.[Hat tip to readers Tony and Terry who separately flagged up the administration.]
How do I get my money back from Viderium?
Anyone who cold-calls you claiming they can get your money back from Viderium or want to buy your bonds is a scammer.
If you were advised to invest in Westway by an FCA-regulated company, you may have recourse to the Financial Ombudsman and Financial Services Compensation Scheme. Unfortunately for investors, as yet I’m not aware that any FCA-regulated companies did promote Viderium.
The standard procedure when an unregulated investment goes into administration is to write off the investment and treat any return as a bonus.