By Tom Winnifrith | Friday 12 May 2017
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
I am unable to sleep because of the stifling heat of Southern Greece as well as the prospect of another week of holiday with the mother in law. Sean Smith, the CEO of AIM casino posterboy Eden Research (EDEN) is probably also suffering nightmares and insomnia but for different reasons. As he desperately tries to persuade his auditors to sign off Eden's accounts without an emphasis of matter, Smith knows that the £920,000 Terpenetech panama pump fraud he masterminded is now unravelling. The question is not will it cause Eden's destruction but when will this time-bomb blow up. I have thus, whiled away the early hours with a letter to AIM Regulation which is below.
Ref the £920,000 securities fraud at Eden Research PLC & Nomad Shore Cap
In August 2015 Eden Research issued £920,000 of shares to buy a 29.9% stake in a worthless associated company Terpenetech. At the same time Terpenetech paid £600,000 to buy a license from Deen, a license that has since been shown by Terpenetech's results to be worthless.
At the time, via its PR agent, the now discredited Paul McManus of Walbrook PR, Eden insisted that the cash had been receieved before the shares were issued. Terpenetech's annual report for the year to July 31 2016 came out last week and shows that Mr McManus was lying. I guess that is what Eden pays him to do.
The report shows that the shares were al sold ( in a hurry and at a steep loss). The cash was used to repay Eden not only for the worthless 2015 license bot for a worthless license Eden booked as a sale in 2011! That seems fairly aggressive revenue recognition don't you think?
Terpenetech ended the year to July 2016 with zero cash and is clearly insolvent. It appears that no other shareholder has actually paid for his shares in Terpenetech so in fact it is a subsidiary not an associate and this related party revenue should not be recognised at all. The whole thing is a sham as demonstrated in articles HERE and HERE.
What is stunning is that Nomad Shore Capital was made aware on the nature of the Terpenetech panama pump fraud back in the Autumn of 2015 yet a) agreed to become Nomad b) undertook a placing for Eden anyway. In failing to investigate the nature of the Terpenetech fraud it palpably did not do proper due diligence on Eden before taking on the mandate and raising cash from investors.
I thus suggest that you take immediate action:
a) The suspension of Eden's shares on the world's most successful growth market pending the publication of a truly independent enquiry into the Terpenetech fraud
b) The start of an enquiry by your esteemed employees in the highly regarded crack team at AIM Regulation into whether the actions and inactions of Share Capital have brought AIM into disrepute.
I remain, as ever,
Your obedient servant
The Sheriff of AIM
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