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Tern – “Updated Director Information” = WE LIED

By Nigel Somerville, the Deputy Sheriff of AIM | Thursday 9 August 2018

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.

Another day and another shocking disclosure from AIM-listed Tern plc (TERN). Yesterday, at 3.10pm, after releasing details of two director buys which were trivial and showed Tuesday’s news of Device Authority’s elevation to “2018 Emerging Star” to be just a ramp (or insider trading by the chairman, take your pick!) we were told that disclosures in relation to two directors of the company had not been entirely truthful: the published directorships of the two had omitted not just the odd one which might have slipped the mind. No, it was TEN!! More to the point, it was ten insolvencies which should have been declared when they were appointed – and a further two which should have been disclosed after appointment.

I had already been aware of the carnage at Bruce Leith’s previous venture, Digital Learning Marketplace (DLM) and have written extensively about it (see HERE and HERE) – and had drawn the regulators’  attention to the false prospectus upon which he was elected to the board of Tern back in 2013. The puzzle for me, therefore, is why this is all coming out now. Perhaps the chocolate teapots at the FCA and/or the oxymorons at AIM Regulation have finally woken up to the fact that there was indeed something wrong, some five years after being told? No, I rather doubt that.

As for Ian Ritchie, he joined the board of Tern in June of last year as chairman – and seems to have “forgotten” about seven insolvencies which should have been declared when he was appointed at Tern. Indeed, the RNS announcing his arrival told us:

Ian brings to the Board a breadth of experience and an extensive track record in the software industry, in which he has worked for more than 35 years….

35 years, and he didn’t know he had to declare these insolvencies?

Ian has been Chairman of AIM-listed cloud computing company, Iomart Group plc….

An AIM chairman  - CHAIRMAN!! - who (being charitable) doesn’t know the disclosure rules? Really?

In the wake of last week’s confessional which updated the market on Device Authority’s (presumably lack-of) trading, which came after a placing at 26p which surely to goodness must raise an eyebrow as to whether that constitutes securities fraud this is truly shocking stuff.

One has to ask whether the board of Tern simply made up of spivs and liars? Can we believe anything it tells us?

As for Nomad WH Ireland, what on earth is it doing? This is basic due diligence which should have been done at appointment and clearly has not been. Are they happy to sign off on any old rubbish without checking it over first just to bank its fees? Can we believe anything it signs off on? Does WH Ireland simply see its role here are providing entertainment on the Casino, rather than regulatory oversight?

So why has this all come out now? Is someone whistleblowing in the background, or has WH Ireland suddenly decided to man-up and do the job it is paid to do properly? I have no idea. But one wonders what will come out next.

Meanwhile the BBs seem to have become even more deluded. As Juicin Drumroll noted in the comments section to yesterday’s piece:

The Mug Army has inevitably interpreted this latest RNS as a good thing, a sign they are closer to retiring; just housekeeping before a monster bid for DA or Tern itself arrives.

Indeed, utterly deluded. And he goes on:

To me looks more like someone with a bee in his bonnet has done a bit of digging & is holding Tern's feet to the fire to show what a POS it is.

I couldn’t agree more.

The BBMs keep on buying and convincing themselves (amongst themselves) that black is white, bad news is good news. Wake up and smell the coffee: you have just been told (for a second time in two weeks) that you’ve been lied to. What else have they lied about?

Keep Selling – this is going to end in tears.

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