P2P lender TrustBuddy shuts up shop over financial irregularities
16 October 2015 | 7476 views | 5
TrustBuddy, one of the few publicly-traded peer-to-peer lending operations in Europe has shut down, after discovering a £3.5 million discrepancy.
The Stockholm-based lender, which was midway through a rights issue on the Nasdaq OMX exchange, has suspended operations and informed the Swedish FSA after a new management team uncovered "serious misconduct" within the company.
In a statement, the firm says an investigation into the company's finances revealed that it had been using lenders’ capital "in violation of their instructions, or, without their permission". As a result, there is currently a 44 MSEK discrepancy between the amount owed to lenders and the available balance of the client bank accounts.
Simon Nathanson, chairman of the Board of TrustBuddy, comments: "We are of course very disappointed in the situation that has arisen. With the new management team in place, TrustBuddy had both the platform and the capacity to create a company built for growth and industry leadership. In light of the recent events, we now have to redirect our focus to find a solution that is in the best interest for all stakeholders."