By Tom Winnifrith | Sunday 14 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 asked my very good pals at the Financial Reporting Council, who we know are major fans of my work, to look into the fraudulent accounts of Eden Research (EDEN) for 2011, 2012, 2013, 2014 and 2015 on February 17 2016. Okay 2015 accounts were not out at that point but I was sure they would be fraudulent - they were. Now 2016 accounts for Terpenetech are out we have it again confirmed that the 2015 accounts were crook and 2016 accounts - due within days - will almost certainly be fraudulent. So I have written to the FRC again. The letter follows.
Fraudulent accounts of AIM listed Eden Research PLC 2011 to 2016 - new information
You may remember my last missive on the subject of AIM listed fraud Eden Research PLC in February of last year. In it I pointed out that in 2011 Eden booked 100,000 Euro of sales with a company that did not exist at the time the announcement was made. That company, Terpenetech, did not pay for those sales until August 2015 yet the sales were counted as a current asset in the accounts for 2011, 2012, 2013 and 2014. I asked you to investigate that fraud.
Now evidence is in the public domain of a far larger fraud involving Terpenetech Limited which last week published its accounts for the year to 31 July 2016. In Calendar 2015 almost all the sales announced by Eden were from the £600,000 sale of a license to Terpenetech ( a company at that point still to pay its 100,000 Euro invoice from 2011 and which had no spare cash).
Terpenetech's accounts out last week for the year to 31 July 2016 show net cash at year end of nil. It also showed that the £920,000 of Eden shares it picked up at the same time as the "license sale" as Eden bought a 29.9% stake in Terpenetech, had all been dumped at a loss and that cash had paid all outstanding bills to Eden.
Companies House will also show that the only Terpenetech shareholder to have paid for its shares is Eden. I therefore suggest that Terpenetech is effectively a subsidiary of Eden and that the sales revenue from 2015 should thus be disgregarded. Firthermore since the license has generated sod all sales for Terpenetech the £920,000 carrying value for its 29.9% of Terpenetech in Eden's books should be written off. Terpenetech is essentially insolvent.
It is clear to me that this was not a real sale booked by Eden. It was simply a panama pump securities fraud as I explain HERE.
Apparently on AIM such fraud is acceptable as AIM Regulation appears unwilling to do anything about it. But surely the accounts for 2011-2015 need to be restated at once. Moreover the auditors to Eden must be made aware of this before they, next week, consider signing off an fraudulent accounts for 2016.
I urge an immediate investigation.
I remain, as ever,
Your obedient servant
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