Veltyco Group Update – Questionable Share Transactions Via Bulgarian Companies

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FinTelegram received information from sources close to Veltyco Group and its shareholders that indicate that the company’s founder and then-director UWE LENHOFF bought Veltyco shares in 2017 without disclosing these director’s transactions. It may be concluded that the price hike in 2017 was actually the result of these insider transactions. Moreover, the share transactions have been executed via Lenhoff’s Bulgarian companies involved in the illegal broker schemes around Option888 and others. Hence, the money of defrauded investors may have been used for these transactions and thus laundered via Veltyco shares.

Much Regulatory Work Ahead

The new Veltyco board member Paul Duffen assumed the role of executive chairman the company said in a press release on March 7, 2019. And he has a lot to do after the arrest of the company’s founder and main shareholder Uwe Lenhoff. The latter is charged by European authorities with financial crime, money laundering, and fraud.

The information FinTelegram received, state that Uwe Lenhoff used his Bulgarian companies Windsor Enterprises Ltd and Savora Consulting Ltd to purchase Veltyco shares back in 2017 for several hundred thousand Euros. At the time of the transactions, Lenhoff was not only the largest Veltyco shareholder but also the company’s director and Chief Operation Officer (COO). Given the tight liquidity of the share and the limited number of trades, such insider transactions clearly push the share price up.

Insider Trading And Investors Perceptions

From January to September 2017, the price of Veltyco shares had almost tripled. Between January 2017 and September 2017 the price rose from GBX 33 to more than GBX 100.

Veltyco insider trading and share price developments
Veltyco share price development

According to information available to FinTelegram, some investors approached by Lenhoff entered Veltyco during this period and were attracted by the rapidly rising share price. This was confirmed by FinTelegram at least by two institutional investors. Neither Veltyco nor its directors disclosed any insider and/or directors transactions in the companies shares. On the contrary, in the only trading update we found, the board is happy to disclose a strong trading of its shares in 2017.

Veltyco trading update (Source: Regulatory News on London Stock Exchange)

The intel FinTelegram received from different parties actually indicate that the Veltyco share price may have been manipulated and/or affected with/by undisclosed insider and director transactions.

Laundered Funds From Cheated Investors?

It has to be said the Lenhoff’s Winslet Enterprises Ltd received money from his illegal broker schemes via illegal payment services providers (PSP) such as XTrabit s.r.o. or Payific. Authorities assume that this money has actually been stolen from retail investors by the illegal broker schemes around Lenhoff and Veltyco (e.g. Option888, XMarkets, TradoVest, TradeInvest90 etc.).

XTrabit s.r.o. has also paid money to Helix Trading Ltd, a company beneficially owned and/or controlled by the former Veltyco director Hans Dahlgren who exercised Veltyco options via this Helix Trading Ltd in Sept 2017 (Source: Veltyco press release dated Sept 18, 2017)

Hans Dahlgren, Helix Trading and Veltyo involved in share transaction
Helix Trading and Veltyco director Hans Dahlgren

Violation Of Securities Law

The big question here is whether or not the other board members have been aware of these questionable directors transactions. Furthermore, it needs to be investigated by the authorities and the Financial Conduct Authority (FCA) whether these transactions violate securities laws in UK and other jurisdictions. Insider trading and/or share price manipulation usually do.

FinTelegram will continue its research and reporting.

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