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Gowex goes bankrupt after CEO admits falsifying accounts

2014-07-07 08:12:00| Telecompaper Headlines

(Telecompaper) Spanish wireless internet services provider Gowex is to file for bankruptcy after its CEO and founder Jenaro Garcia admitted that he had falsified the company's accounts for at least the past four years. "I made a voluntary confession in court. I want to collaborate with justice. I will face the consequences," said Garcia on Twitter, having earlier posted "I ask everyone for forgiveness. I am deeply sorry." In a statement to Spain's stock market regulator CNMV, the board of Gowex said it had accepted Garcia's resignation and that in anticipation it would be unlikely to be able to meet debt repayments the board had agreed to file for bankruptcy and was looking at additional measures to protect the company's interests. On 04 July Gowex said it had hired PricewaterhouseCoopers to prepare a "full disclosure forensic report" in response to the critical research note from US firm Gotham City Research that triggered the company's collapse. The note posted on Gotham's website accused Gowex of overstating its sales and operations, saying that its real value was "zero" and that "Gowex's actual wireless revenues are at most 10 percent of what it reports in its financial statements." It also said that Gowex appeared to be operating far fewer Wi-Fi hotspots than it claimed.

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Category:Telecommunications

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