Algorithms? It’s betting on sport . . .with your cash
A.T. writes: Since you wrote about Apex Algorithms, has anything transpired? The company’s accounts show that it has more than £1.6million in managed funds, so has the Financial Conduct Authority looked into it?
THREE years ago, I warned that Apex Incorporated Limited – to give the company its proper name – was using false claims to persuade investors to pump £50million into its loan bonds, with the promise of 16 per cent annual interest.
Apex advertised: ‘Our performance shows positive return on investment for investors for seven years.’
Not bad for a company that had only existed for four years. And while investors somehow got the impression that their capital was fully secured against company assets, I revealed that small print admitted that investors’ cash was unsecured and could be lost completely if Apex collapsed. Since then, Apex seems to have dumped its idea of selling its IOUs to the public. Instead, it has reinvented itself as a gambling business based in Sandwich, Kent, that beats the bookies by betting on football results.
It claims to detect ‘whenever the bookmakers’ odds do not reflect the true odds for a particular event’, at which point Apex gambles and – it says – makes ‘consistent double-digit yields’.
And in case this sounds like some fly-by-night outfit that will vanish before the final whistle, the company’s prospectus adds: ‘Apex Algorithms was established by ex-City workers who have a passion for both the financial and sports markets, are enthusiastic gamblers who are fully committed to intense quantitative analysis.’
Who are these ex-City workers? When I asked Apex’s owner Nathan Burgoyne this question three years ago, he failed to name a single one. This is still the case.
He cannot be talking about himself. I can find no record of him in the financial services industry, and when he was in court in 2015 and convicted of careless driving after badly injuring a pedestrian and killing his dog, Burgoyne described himself as a self-employed marketing representative. I doubt he was referring to his brother either: Daniel Burgoyne was jailed for two years for running a carbon credits investment scam.
One thing that has changed is that while company records still show 30-year-old Nathan Burgoyne as the owner of Apex, he has recruited another director. Paul Northcott, 58, has a real business background and says that he was a customer of Apex who was so impressed that in 2019 he became its managing director.
This brings us almost up to date. Almost, because Apex’s website has disappeared, and on December 4, Paul Northcott was arrested by Kent Police following allegations of fraud. He has been freed on bail while investigations continue.
Kent Police will not discuss the allegations, but I know that some investors are hoping any problems can be cleared up sooner rather than later if Apex can produce proper accounts showing where and when bets have been placed, and the results that back up the company’s claims of success and allow it to reward investors.
I did invite Northcott and Burgoyne to comment, but neither offered to give any comment, explanation or reassurance to investors. However, Northcott has told investors: ‘The bail conditions still prevent Nathan and I from communicating.’
He added: ‘I still strongly deny any allegation of wrongdoing and am working to clear my name, and I am sure Nathan feels the same way.’
Finally, to answer your question, I am not aware of any action by the Financial Conduct Authority. A decade or so ago, the City regulator did regard pooled gambling schemes as falling under its jurisdiction and worth investigating to protect consumers. Today, it does not.