Category: Business

Lekoil Scammed

Lekoil is a  Nigerian oil company and their share price dropped 73% on the London Stock Exchange, on the announcement that it had been scammed to the tune of $184.

Lekoil needed a huge loan and was approached by Seawave Invest Limited acting on behalf of the Qatar Investment Authority.

Negotiations ensued and went on for months as executives sorted out the fine details of the loan, which was needed to pay for development of the Ogo field within Oil Prospecting Licence 310 in Nigeria.

Lekan Akinyanmi, the Lekoil chief executive led the negotiations for the company and in time a formal agreement was reached.

Control Risks, a consultancy headquartered in London, prepared a due diligence report that did not raise red flags. Analysts said the loan’s relatively low interest rate of 3.72 per cent should have raised suspicions.

Norton Rose Fulbright, an international law firm that has previously worked for Lekoil, provided legal advice on the deal.

Control Risks, a consultancy headquartered in London, prepared a due diligence report that did not raise red flags, the people said. Analysts said the loan’s relatively low interest rate of 3.72 per cent should have raised suspicions. Norton Rose and Control Risks declined to comment.

But it was all fake – the people claiming to be from the Qatar Investment Authority were criminals, who went to great lengths to appear genuine.

Lekoil was left desperately trying to find money or be forced to sell off assets.

OOPS. Better do better checks next time someone offers a huge loan.

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Business Distribution Fraud

This fraud is where criminals pretend to be a well-known UK retailer and order goods from suppliers (usually overseas). The goods are delivered but payment is never made as it’s the criminals who received the delivery.

A recent example of this fraud was perpetrated on Moon Buggy which is a German company making child buggies.

Moon Buggy were contacted by a man they believed to be the purchasing director for John Lewis and they sent him 2 lorry loads of buggies worth £214,000 to a warehouse in South London.

They should have noticed that the man’s email address wasn’t but  and they should have checked he was the real deal but they didn’t check sufficiently and are out of pocket for a serious amount of money.

The Police response to the crime was not convincing and Eddie Prendergast working in the UK for Moon Buggy started to search for the stolen prams.

He found them on sale on eBay and bought one so he could check the serial number – he had found the stolen prams. He identified names and addresses of the sellers and reported this to the Police.

Again, little response from the Police – just ongoing investigations.

There are numerous examples of this distribution fraud – always make sure to verify who you’re talking to where shipments of any kind are concerned.

If you have any experiences with scammers, spammers or time-waster do let me know, by email.

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Late Payment by Big Business

Government statistics show that small businesses are owed on average £6,142 mostly by larger firms not paying them for goods and services on time. Bad practices range beyond simply paying late to include larger firms forcing a discount off an already agreed price, paying-to-stay (smaller companies pay larger firms to remain a supplier, but without the promise of any actual work) etc.

The research shows 37% small businesses have run into cash flow difficulties, 30% have been forced to use an overdraft and 20% cite a slowdown in profit growth. If all payments were made on time perhaps 50,000 more businesses could be kept open each year, whilst the UK economy would receive a £2.5 billion boost.

FSB is now campaigning for every large company to have a Non-Executive Director responsible for good supply chain practice – reporting to the Board as head of a sub-committee, reporting to the AGM, and writing in the Annual Report of what the company is doing to help their suppliers.  The Government is listening, and has adopted this model for its own Departments

The new proposals, building on action government has already taken to improve access to finance and the appointment of the Small Business Commissioner, include:

the call for evidence to consider the best way company boards can put in place responsible payment practices throughout their supply chain, for example giving a non-executive director specific responsibilities for the company’s prompt payment performance, promoting innovative technologies, such as the latest accounting software, to help small firms manage their payments processes, and empowering trade bodies to highlight the best and worst practices in payment behaviour

The government has also set the ambition that all its departments commit to paying 90% of undisputed invoices from SMEs within 5 days and ensure all government departments have a dedicated non-executive director responsible for prompt payment, improving payment practices and exploring how better to use technology to make payment processes more efficient.

If you have seen the problems caused by such late payments – let us know, by email.

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Europcar Pay Drivers £38 million Compensation

Europcar UK has been found guilty of systemically inflating the cost of repairs through secret rebates with suppliers. This is clearly defrauding unsuspecting drivers.

Europcar customers who fell victim to fraudulent charges for repairs on hire cars will receive compensation as the company has set aside £38 million to repay them.

Up to half a million drivers were fraudulently charged inflated prices for repairing scrapes and other damage and will be reimbursed by the company.

Leicester City Trading Standards is still investigating the car hire firm over their actions.

Europcar’s UK division made a pre-tax loss last year of $40.3 million after setting aside £47 million to deal with the investigation. In the previous year it made a profit of £13.1 million.

A Europcar spokesman has said that the company is undertaking a thorough investigation and Europcar UK is fully cooperating with the authorities”.

Well done whoever spotted the scam and it’s certainly cost Europcar a lot of money.

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