Thu, 04 Feb 2016 | ADMINISTRATION
Rebus, a claims management company started with help from crowdfunding, has entered administration.
The company raised over £800,000 on Crowdcube in 2015 but investors now stand to lose all of their money from the venture.
Rebus claimed that the funding would go towards an expansion that would then deliver investor returns of up to ten times their original input within just three years.
The business focused on investigating mis-selling claims and dealt mostly with claims around complex investments, which HMRC later deemed to be tax avoidance schemes. Rebus earned fees upon settlement of client disputes and, according to the firm's website, it was managing around £930 million worth of claims in 1,700 individual cases.
The collapse marks the largest failure of a crowdfunded business and has highlighted the fact that investments made through crowdfunding are not covered by the Financial Services Compensation Scheme, so any money put in will be lost entirely.
Crowdcube issued a statement to the Financial Time0s about the issue: “Whilst the failure of any business is disappointing, not all businesses will succeed and [it] therefore highlights the importance of spreading investment risk with a diversified portfolio.
“Investors on Crowdcube can be assured that we are committed to ensuring transparency and have rigorous due diligence processes in place.”
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