BearCast Special on Quindell – Rob Terry’s stock is all being sold he is not a net buyer – Equity First Explained

Comments

1. ---

   Drake

   6 November 2014, 02:16

   Whatever this thing in 2008 was (from a brief look they sold the shares transferred as collateral and didn’t buy them back to return to the borrowing directors at the end of the term), nowadays EFH say this about their loans:

   “By repositioning portfolios between securities and cash, EFH makes market-neutral spread trades over the course of the loan life without affecting the stock or security price.”
   http://equitiesfirst.com/images/efh/insights/white-papers/pdf/EFH-An%20Alternative%20to%20Margin%20Loans.pdf

   The directors of IQE recently used an EFH loan to buy shares in their company.

   Even if the 2008 thing was somehow still going on it would be RT & co who were being scammed. It’s not a way for them to sell their holdings. Shares used as collateral cannot be sold by them over the next 2 years should they want to salvage something if they knew an end game really was in the offing.

2. ---

   wildrides

   6 November 2014, 02:35

   Brilliant , truly Brilliant Tom .

   A stunning piece of journalism exposing the rot and filth of the city and the links across the pond .

   The investment community is deeply indebted to you for publishing this .

3. ---

   Paul Scott

   6 November 2014, 02:55

   Hi Tom,

   Wow, what an explosive bearcast.
   If you’re right about the nature of the Equities First Holdings deal, then the share price could indeed collapse quite quickly.

   As you say, Terry has form in this area. He short sold TIG shares before they collapsed back in the dot.com boom, so we know that he puts his own interests first when the story begins to unravel, as that’s exactly what he did last time. Therefore it makes complete sense that he is likely to do the same thing again.

   One thing confuses me though. In the announcement yesterday it said;

   “Under the terms of the facility, the lender is contractually prohibited from short selling or voting the transferred shares during the term of the loan.”

   This apparently undermines your allegations, but on closer inspection it says that EFH is prohibited from “short selling”, but it doesn’t say anything about “selling” the transferred shares – i.e. if EFH simply sells the shares that have been transferred to it, then that’s not actually shorting, it’s just vanilla selling.

   Although surely Terry will have to issue an RNS saying that shares have actually been transferred to EFH? Or will the transferred shares still be counted as belonging to Terry?

   One thing you can be sure of with QPP – things are never what they seem. The company has a culture of doing everything in a convoluted way, which in my experience usually means that there is some underhand purpose.

   I’ve always thought this company reeked to high heaven, and warned my readers on another site about it no less than 18 times from Dec 2012 onwards.

4. ---

   Seagreen2

   6 November 2014, 03:08

   Tom

   This is another incorrect and untruthful statement Tom

   “You folks all think Rob Terry, Larry Moorse and Steve Scott are buying Quindell shares. WRONG! Their net positions are going down and going down fast. This is End Game. “

   They have purchased more shares plain and simple….(not saying the net value wont go down or up or it wont be the end game) ……..but they have borrowed money on the back of collateral which happens to be shares in the same company…and chosen to use this money to purchase more shares….end of story….lets stick to facts…I am not arguing whether or not the company will survive..I have already said I dispute the fact that you have proven any fraud etc on the other thread

   A spot of Queensbury rules ….and truthful analysis would not go amiss ..as opposed to acting in the same manner that you are alluding the directors of qpp do

   Not saying it would be my strategy and indeed I can think of a man from iceland who tried this tactic and became unstuck!

   Sea

5. ---

   ADVFNPrep

   6 November 2014, 03:38

   Good work Tom! I guess this also could explain why the purchases by Rob Terry and the others didnt affect the share price. At that time, Equity First was already selling. Perhaps they bought their own shares back from Equity First :P.

6. ---

   james

   6 November 2014, 04:27

   You are one top sleuth Tom.

   Audio was eloquent and simple to understand.. even a die hard QPP hugger would have to be in absolute denial to NOT see what is going on here.

   I’ll dare to add.. one of your best audio special’s to date.

7. ---

   Forty Two

   6 November 2014, 04:34

   The bottom line line is Terry could buy with the sales that Q has made to Advanced Data Simulation (owned by him and one of his wives ex or current) and disclosed at the back end of the A/R. This is a joke. They are out of money. Tom is right. And I should know. Good luck Swindell holders…

8. ---

   james

   6 November 2014, 04:40

   A regular check at the QPP share register should tell how many EF has been selling down. Also, will provide definitive proof of how EF operate in such deals.

9. ---

   Forty Two

   6 November 2014, 04:54

   And after RT told the Canaccord sales force they were cunts for not ramping his stock at 40p old money when he wanted to sell I bet you they won’t be raising money. Cenkos will try but Dobell has cut them off… Fido have no clue – at all. Watch and learn…

10. ---

    alcira16247

    6 November 2014, 06:03

    Tom

    First rate investigation and analysis on what’s going on with the Quindell mafia!

    May I add the following piece, which was posted yesterday on LSE QPP and promptly attacked and ridiculed :-

    “Last Friday the Court of Appeal, in a case called Platt v BRB, decided that the claimant’s NIHL claim was time-barred because he ought to have discovered the facts on which his claim was based more than three years before he started his action (which is the statutory limitation period); see attached link.

    This decision is likely to have a serious impact on the viability of such claims because, unlike for example whiplash claims, NIHL claims are invariably based upon exposures to noise occurring many years ago. In short, the NIHL claims bubble may have burst, and it occurs to me that this could account for the recent further decline in the sp.

    But no doubt Quindell will clarify its current NIHL claims experience at a convenient time.”

    www.insurancepeople.uk.com/newsfull.php?id=2912

    After Quindell’s much heralded foray into into the industrial deafness market, another nail hammered into its coffin, I would suggest!

11. ---

    gateway

    6 November 2014, 07:17

    One thing I don’t understand – surely if Equities First sell the shares then the voting rights go with them, yet the RNS states explicitly that ‘Under the terms of the facility, the lender is contractually prohibited from short selling or voting the transferred shares during the term of the loan.’ – how can they sell the shares without selling the voting rights along with them?

12. ---

    Tom Winnifrith

    6 November 2014, 07:32

    G

    When EF flogs the stock it will be neither using voting rights or going short. It can thus doso without breaking the terms of the RNS. Where does the RNS say EF wont flog shares or that if it flogs them others do not get voting rights?

    t

13. ---

    zeronegative

    6 November 2014, 07:58

    Hi,

    As I understand RT does not have enough money to buy stock so here has got a loan. We hear he could get £30-40 million off EF to buy more stock.

    As this money is a loan from EF won’t he have to repay all the loans he’s be given over the 2 year period. How could be possibly repay a £30Million loan to EF if he can’t even raise £1.2 Million???

14. ---

    slim fizzlebeef

    6 November 2014, 09:07

    This isn’t far off being the smoking gun.

    Rob Terry must have known the insti’s would read the announcement as a disposal with a small director buy tacked-on. Dressing it up as a ‘director share purchase’ must be an attempt to trick PI’s.

15. ---

    Sweet Karolina

    6 November 2014, 11:23

    Can anyone explain how things work out with this deal, if our chocolate teapot authorities do what they should have done weeks ago and suspend trading.

    The Market abuse going on here is massive. The shares must suspend, they must do a proper investigation, which either clears RT et al or condemns them (I know which of those I would put my money on)

16. ---

    havata

    6 November 2014, 11:36

    I dont see how they could pull this off without it becoming noticable on the share register. If they are sold in the open market then it is with voting rights, so that would assume that the no voting rights bit of the RNS was baloney. Even so Capita will know via crest who holds what and this cannot be faked.

17. ---

    Tom Winnifrith

    6 November 2014, 11:40

    SK

    easy – the shares will be susp & wont come back. Some BBMs will admit I have been right all along & apologise for the death threats, bogus restaurant reviews, abuse etc as they prepare to explain to their Mrs that Xmas is cancelled until 2023.

    Others will blame me, Gotham, the CIA for bringing down a Great British company blah blah blah.

    For me it will be 72 hours of drunken celebration as its coke & hookers time all round at RMPC and then onto the next one for the Sheriff to bring down

    T

18. ---

    Sweet Karolina

    6 November 2014, 12:28

    Thanks Tom, I was more on about the EFH deal and the impact that could have. I assume that they have already flogged enough to cover what has already been drawn down and that further drawdowns only become available once EFH have already sold more than enough to cover it, so no issue to them if the share suspends. But it would screw RT and his plans to get out at BBM expense, would it not?

19. ---

    Scott Sanderson

    6 November 2014, 13:27

    Tom sorry off topic but did you have any thought re my question on your securities fraud piece;

    If QPP state in a RNS that 1m shares are to be issued to company A, then Cenkos will ‘verify’ that RNS and as it’s their nomad responsibility to issue shares they will, as instructed in the RNS, issue shares to company A.

    So how does Cenkos issue them to company B?

20. ---

    Tom Winnifrith

    6 November 2014, 13:33

    SS

    Sorry busy day. The Nomad does not issue shares. The Company instructs the share registrar ( capita) to issue. The Nomad should probably ensure they are issued to who the say they are meant to be issued to but in practice they do not. You might pick up Cenkos for not verifying this as negligent but in reality Nomads never verify this , they assume their clients are not engaging in Securities fraud. Give this is the AIM Casino that is naive.

    So Cenkos, a bit lazy, Quenron doing the fraud.

    T

21. ---

    Scott Sanderson

    6 November 2014, 14:24

    Right thank you. So only a slap on wrist for Cenkos, but maybe more than a slap as they’re still keeping quiet on the matter.
    Another two ques which isn’t clearly discussed in your soundcast;

    1. If EHL are selling the transferred shares they received in the open market, and if I buy a chuck of them, then I will have voting rights attached to those shares, as will all shareholders buying shares in open market, but RNS says they’re contractually prohibited from voting the transferred shares, so how is it possible for EHL to sell and still adhere to their contractual arrangement?

    2. The share register will show RT as owning 46,650,000 shares, even though some have been transferred to EHL, RT still owns them. Worth noting because their transferred and not sold to EHL there is no need for an RNS stating a reduction in change of Director holding.
    So if EHL now start selling those shares in the open market and again assume I buy some my name will appear on the share register so in effect the same shares are recorded as being owned by RT and myself. How is that possible?

    Thanks again

22. ---

    StephenPeel

    6 November 2014, 17:59

    Tom – I just spent a few days hanging out on the LSE QPP BB. I see why you sound so bombastic now. I also remembered why I swore off bulletin boards about 10 years ago. The noise to signal ratio is massive, filtering out anything useful is hugely time consuming and also bad for your mental well being.

    I work in IT and I think it would be possible to have a computer surf them for you and calculate a few useful metrics.

    Volume of posts, number of posters, repetitiveness, combativeness, etc…

    That should tell you everything you need without you actually having to dip your toe in.

    Let me know if you think anyone would want to buy such a service.

23. ---

    dasv

    7 November 2014, 06:11

    StephenPeel – I believe there are trading algos which work off trends in twitter posts. What you are suggesting is just applying the same principle to lse.co.uk.

    Considering the investment abilities of the average lse.co.uk punter, I would advise your algo concentrates on shorting opportunities.

    “While there are trading firms that have begun dabbling in aggregation and analysis tools to scour news feeds for useful information, most of them aren’t trading directly off that information. And fewer still are actually trading off Twitter, even though less than a month ago, social media received the blessing of regulators to be a conduit for market-moving news.

    One of the most common ways financial firms plug these data streams into their models is through middleman firms such as RavenPack, which aggregates news from thousands of sources. Each day its systems put out anywhere from 20,000 to 50,000 “clean messages” culled from corporate newswires and professional news sources.”

    http://www.businessweek.com/articles/2013-04-24/how-many-hft-firms-actually-use-twitter-to-trade

24. ---

    Dominic Cooper

    7 November 2014, 07:27

    And another things.

    The RNS says that EFH are contractually prohibited from short-selling the transferred shares.

    Thing is that’s a meaningless definition. When you short a share, you do not short a share you already own (or have transferred to you). Indeed you don’t short sell ANY particular identifiable share. You borrow the shares from elsewhere, then you sell them. If you are the holder of those shares in the first place (or have the power to deal in them as transferee), it would not be possible to short them. You would be – by definition – long.

    So why is this mentioned at all?

    It’s kinda like a tenant you rent your house out to saying that he is “contractually prohibited from selling the property”. Why say that they are contractually prohibited from doing something they can’t do anyway?

    That leads to one inexorable conclusion which is that they have put it in to make BBMs think it means that they can’t SELL the shares, when in fact all that has been said is that they can’t SHORT SELL them. Inclusio unius est exclusio alterius.

    And another thing. I have borrowed money to buy my house. I have put the house up as collateral. It is called a mortgage – a common, well-known, transaction.

    I have not “transferred” my house to the bank, I do not have a “non-recourse facility” and do not have to “fully intend to redeem” the transaction in two years time. I owe the money and have to pay it back. When it is paid back the collateral is free from charges; until then it is not. The asset remains nominally mine.

    That is the nature of secured lending. What Terry et al have done is nothing like what they are trying to portray themselves as having done.