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SeanR

Another ZX Spectrum device indiegogo fundraiser

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3 minutes ago, BongoInferno said:

A class action suit will mean the case will be heard in the High Court. It will be years before the claim is heard once it's been issued, assuming it's not settled before a final hearing (and it seems unlikely it will be settled if the company is wound up). Class action suits are complicated and take a lot of organising before you even get to issuing the claim.

 

The best advice I heard from a Judge about bringing a claim for money was to properly consider if you think there is a realistic chance of getting your money back. Even if the case is found in your favour in a final hearing, getting a court order in your favour doesn't mean you will ever see the money you are owed, regardless of the enforcement options it opens up for you. It will also cost you time and money to get there. I would imagine this is what many of the 4550+ are thinking.

 

it's not really that though. This is the backers, acting as a single creditor entity, at the winding up of RCL.

 

Thus ensuring that:

 

https://www.gov.uk/wind-up-a-company-that-owes-you-money
 

Quote

 

the company assets are sold

any legal disputes are settled

the company collects money it’s owed

funds are paid to you and any other creditors

 

 

isn't just Janko and Levy disappearing into the sunset having spent the money, as they've done in the past, but rather a bit of:

 

https://www.gov.uk/register-creditor-bankruptcy

 

and a lot of:

 

https://www.gov.uk/government/publications/claim-money-back-from-a-bankrupt-person-or-company-in-compulsory-liquidation-guidance-for-creditors

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https://www.theregister.co.uk/2019/02/22/retro_computers_ltd_winding_up_backers_creditors/

 

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The next step in the RCL saga is for a creditors' meeting to take place, overseen by the Official Receiver. Whoever the Official Receiver allows to appoint the liquidator – normally the creditor or group of creditors with the biggest financial claim on the remaining assets of the business – tends to be the group which gets most of its money back.

 

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I'm trying not to be cynical here, which is hard seeing as how the Vega+ saga has panned out, but getting the backers to act as creditors, in order to get the company wound up, is completely pointless if you're a backer (and I'd be suspicious why some people are wanting the backers to do this).

 

The winding up order is issued after persons (or companies) have unpaid debts from the company and have petitioned the courts for a winding up order. The outcomes of which can be:

 

https://www.realbusinessrescue.co.uk/winding-up-petitions/what-is-winding-up-order

 

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Once the Court has issued a winding up order there is nothing that can be done to stop the company from being completely liquidated. However, there is a short period of time during which you can take action to prevent the order from being issued. When a creditor or HMRC issues a winding up petition to the Court it is reviewed and if approved it is then issued to the insolvent company. After receiving the petition the insolvent company then has 7 days to do one of four things:

 

1) Pay all debts owed to the petitioner (whoever is petitioning to liquidate your company, whether it be HMRC or another creditor).
 

2) Arrange and propose a Company Voluntary Arrangement (CVA) to come to an agreement with the petitioner. Such an arrangement could allow you to repay the debt gradually over a period of up to 5 years, while also letting your company escape liquidation.
 

3) Obtain an Administration Order to have the company put into Administration, during which a licensed Insolvency practitioner would be appointed as an administrator to evaluate and sell some of the company’s assets. During a Court-order Administration all legal actions are stayed, which means the Court will not issue the winding up order against your company.
 

4) Dispute the debt. In order for this to be an option there has to be substantial proof that the debt Claim is unfair or inaccurate. This is a serious allegation against the creditor known as “abuse of court process.”

 

Out of those 4 options, what can RCL realistically do now?

 

We pretty much know they have no money left (or assets), so option 1 (pay all debts) is out. 

 

Option 2 (arrange a CVA and pay the debt over 5 years) is also out, they don't have any revenue stream - how can they make future payments?

 

Option 4 is likely out too - they can't dispute the debt as it's not unfair or inaccurate.

 

So the likely outcome is Option 3 - the company goes into Administration. Except the problem with RCL now is that there are no assets left to sell (except maybe the unsold original Vegas, but they're worthless now). So the creditors (and backers) get nothing. Except what we now have is RCL placed in Administration, just ready to be "seized upon"...

 

This is where I could be really cynical.

  1. Social media campaign starts to petition backers to become creditors
  2. RCL is forced to wind up due to unpaid debts to those creditors
  3. an insolvency practitioner is put in place to manage the "assets"
  4. there are no assets to sell, therefore the creditors (and backers) get nothing
  5. in steps a third party who buy up the remains of the company (as in the name and any IP they have) for a token amount (say £1) (which includes the rights to make a Sinclair branded console).
  6. update is posted from "new RCL" saying "sorry we can't give the Vega+ to the backers, the previous directors were bastards who pissed all the money away, but we're starting a NEW crowd funding campaign for a NEW sinclair console - the one YOU ALWAYS WANTED."

Like I said, it's easy to get cynical with the sorry state of this, but getting the backers to act as a creditor, in order to wind up the company, is going to deliver nothing if there are no assets left to sell.

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I think the application has already gone in by a former director (I might be wrong here - was Janko involved early on?) so the backers are putting in a claim to be chosen as liquidators over him so they can legally publish the accounts I think. But I might be wrong, I’m not a stakeholder in this, just another interested viewer. 

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27 minutes ago, gone fishin' said:
  1. in steps a third party who buy up the remains of the company (as in the name and any IP they have) for a token amount (say £1) (which includes the rights to make a Sinclair branded console).
  2. update is posted from "new RCL" saying "sorry we can't give the Vega+ to the backers, the previous directors were bastards who pissed all the money away, but we're starting a NEW crowd funding campaign for a NEW sinclair console - the one YOU ALWAYS WANTED."

Like I said, it's easy to get cynical with the sorry state of this, but getting the backers to act as a creditor, in order to wind up the company, is going to deliver nothing if there are no assets left to sell.

There's no goodwill associated with the company, it's tainted forever so that's one reason not to buy it.

There are no rights to make a branded console, Sky rescinded the rights last year. That's another.

 

At this stage, their IP consists of a really badly made hand-held with free software that doesn't work properly.

I don't think that their IP is worth a pound.

 

You can get a Chinese handheld off eBay for £25 that could play these games better. Put a rainbow sticker on it and voila! A new handheld spectrum.

 

If you were intent on making a unique piece of Spectrum kit, starting from scratch or maybe re-shelling existing tech that works plus giving it a new front end would be a better option. I don't think there's anything to be salvaged from the Vega Plus design.

 

You're absolutely right though, I bet there's not a penny in the pot or any assets worth anything. All they can do now is hope to force some form of official investigation as opposed to getting any money back.

 

 

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Except this move by backers to become creditors is to stop Janko/Levy appointing the liquidators, so that it all becomes public.

 

Levy has done this before. Many times.

 

no more.

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5 minutes ago, Ninja Doctor said:

I think the application has already gone in by a former director (I might be wrong here - was Janko involved early on?) so the backers are putting in a claim to be chosen as liquidators over him so they can legally publish the accounts I think. But I might be wrong, I’m not a stakeholder in this, just another interested viewer. 

 

Exactly.

 

Janko was brought in (illegally) as a director,  took £50,000 of backers money to build the firmware, and then installed FUSE. 

 

Claiming to to be the largest creditor is a move to assign a preferred liquidator, and cover up falsified accounts submitted to companies house.

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2 minutes ago, Ninja Doctor said:

Fear the wrath of a few thousand middle aged nerds. 

 

It was either this or burning down the KFC in Folkestone...

 

:coffee:

 

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On 22/02/2019 at 20:05, SeanR said:

 

Exactly.

 

Janko was brought in (illegally) as a director,  took £50,000 of backers money to build the firmware, and then installed FUSE. 

 

Claiming to to be the largest creditor is a move to assign a preferred liquidator, and cover up falsified accounts submitted to companies house.

 

Even if Planet Computers can assign an insolvency practitioner, they still have to be independent. 

 

https://www.wilsonfield.co.uk/trading-whilst-insolvent/

 

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Trading whilst insolvent and acting irresponsibly, what are the consequences?

When a company enters a liquidation proceeding such as compulsory liquidation or a creditors voluntary liquidation, there is always an investigation into the conduct of all directors who held office in the 3 years prior to the appointment of the liquidator. The purpose of this investigation is to ensure that directors have acted responsibly and whether they took appropriate action to mitigate creditor loses. The information gathered during this investigation will be collated into a ‘D report’ and will be presented to the insolvency service, who will be responsible for deciding whether any further action is to be taken. If sufficient evidence is found that directors could have exercised a reasonable degree of foresight, or have acted downright irresponsibly, directors may find themselves becoming personally liable for the company’s debt to creditors. It may even lead to the insolvency service issuing a disqualification, as they have the power to ban an individual from acting as a company director for a maximum of 15 years.

How to protect yourself if trading whilst insolvent

In order to try and avoid personal liability when trading whilst insolvent, it is vital that directors seek professional advice as soon as possible and initiate preventative measures in order to protect themselves. Trading whilst insolvent is not strictly speaking illegal, however, once directors become aware of it they have a duty of care to minimise creditor loses. Often the best way to minimise creditor loses is to place the company into company administration or a creditors voluntary liquidation. In order to protect themselves, directors should ensure take reasonable care and exercise common sense in order to avoid doing anything to the detriment of company creditors. This includes, but is not limited to, the following:

  • Taking money out of the company in order to fund personal luxuries such as cars or holidays.
  • Collecting an unreasonably high salary when the company cannot afford it.
  • Transferring assets from the insolvent company for free or for significantly less than valued in an attempt to exclude it from any future insolvency proceedings.
  • Paying creditors in preference to others.

 

Now the problem you've got here is "when did RCL become 'trading as insolvent' and did the directors break any laws after that date"? 

 

The directors can legally pay themselves high salaries as long as the company isn't trading as insolvent. This is where you can see the excuses come in. RCL's main sales channel was removed (Argos), they struggled with supplier and manufacturing issues, delays happened to the product (having to outsource firmware development) that caused the company to no longer produce a product or sell that product, making the company "insolvent". But this might have happened after they'd paid the high salaries, because they didn't/couldn't see these issues happening.

 

If you look at the accounts (if they are genuine, of course) then Levy received his last major consultancy payment on the 11/11/16, when there was still £46k in the account. 

 

image.png.50c3b24c703daf48d227bdbe3e418238.png

 

I can't find any other significant payments to Levy after that, even then £5k wouldn't be seen as an unreasonably high salary for a director. 

 

All the other high "consultancy" fees are around May-June 2016, again when there's plenty of cash in the accounts so it wouldn't be seen at a time when the company couldn't afford it.

 

The fact it took until November 2018 for a creditor to apply for a winding up order would say that the company was paying its creditors before then, which we've got to presume includes paying all of the fees to the solicitors as we could presume that they would be the first to issue a winding up order.

 

Will the 350 backers be added as a creditor? Maybe, but it doesn't matter who is set as the insolvency practitioner as the reality is going to likely be that none of the directors did anything illegal. They didn't pay unrealistically high salaries (or expenses) while the company was trading as insolvent - likely sometime after July 2017, as they received a payment from PQube for £16k from Vega sales in June 2016. It's when those payments stopped (which we don't know) when RCL will have become insolvent. 

 

Will the 350 backers, or any creditor, get any money back through the sales of assets? I think we can answer that one.

 

Will the directors be legally held accountable for the company not delivering the Vega+? Well, it's not illegal to be shit at running a company, poor management of suppliers or not being able to produce a product. Companies go out of business all of the time, taking investors money or unpaid bank loans with them. What happened with RCL happens every day.

 

Unfortunately, the lesson is going to be "buyer beware" when it comes to these crowd funded campaigns. And I think most of the backers are painfully aware of this (which is why only 350 out of 4000+ backers have applied to be a creditor). 

 

 

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7 minutes ago, gone fishin' said:

Unfortunately, the lesson is going to be "buyer beware" when it comes to these crowd funded campaigns. And I think most of the backers are painfully aware of this (which is why only 350 out of 4000+ backers have applied to be a creditor).

 

570 backers have requested to be Represented as Creditors totalling £66011

 

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11/11/16, when there was still £46k in the account

 

5 months after receiving half a million pounds, there's 10% left, and 18 months before they shit out 80 prototypes, okay...

 

the bank statements are incomplete.

 

But like Paul Andrews says, there's stuff going on behind the scenes. Sit tight.

 

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16 minutes ago, Longtimelurker said:

I thought they supposedly churned out approx 210 German Tanks as discovered by cunning use of the ZX Vega algorithm.

 

80-confirmed

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19 minutes ago, Longtimelurker said:

Presumably then they were deceptive with the serial number sequencing?

 

Its just a roll of stickers 

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8 hours ago, gone fishin' said:

.

 

Unfortunately, the lesson is going to be "buyer beware" when it comes to these crowd funded campaigns. And I think most of the backers are painfully aware of this (which is why only 350 out of 4000+ backers have applied to be a creditor). 

 

 

Yep pretty much.  Only done one and that was enough.  Did get the product pretty much on time (it clashed with last years cny which delayed things obviously) but wouldn't do it again.

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It should also be noted that I have taken the unit to a 3rd party electronics company who have stated that the unit is a high quality 3D print.

 

 

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lol he came back... got a bit lee fidgety being out of the limelight?

 

 

if it doesn't have a CE mark I'm almost certain it's not allowed to be sold. whether ebay police that kind of thing I don't know

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Very valid point about the charity donation on eBay.

 

Ebay have a policy on it:

 

https://www.ebay.com/help/policies/prohibited-restricted-items/charity-fundraising-policy?id=4286

 

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You can list items for charity without using eBay for Charity if:

You're soliciting on behalf of recognized, tax-deductible charitable organizations (for example, 501(c)(3) or equivalent status with the IRS)

You receive advance written consent from the charitable organization for the solicitation-and include the following information in your listing:

A readable photo or scanned image of the written consent. (This proof can't be a link to a website.) The letter must be on the charity's letterhead and signed by one of the organization's officers

The charity's tax-deductibility status

Your name or eBay username, dates of event or listings, and the donation amount (percentage of the final sale price) you'll be donating if your item sells

 

I suggest everyone reports the item (the link is on the listing page as "Report Item" where you can choose the following to report it as potentially not following eBay's charity policies.

 

1426779493_Screenshot2019-03-11at18_35_46.thumb.png.7b02793791cabe6c717f9c257263f67b.png

 

Other thing that could be reported on is that it's stolen property, as George points out in his video.

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On 09/03/2019 at 08:26, Ninja Doctor said:

Just reported it for being Beta software (against eBay rules). 

 

Well that didn't work. Well done eBay.

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