Has my £40,000 in shares gone down the River?
Ms E.H. writes: I bought preference shares from Orange River Wealth, which promised to send me a hard copy of my share certificate but failed to do so. There was no response to an email I sent to the company. I paid just under £40,000 for shares costing 32p each. They also promised a first dividend would be paid in January 2024.
WHEN Orange River Wealth was raising millions of pounds in 2022, and tempting investors with a startling 15 per cent annual yield, I did take a close look at it and found more red flags than you would see waving at an old fashioned May Day parade in Moscow.
So, 18 months ago, The Mail on Sunday warned that the offer document issued to investors was riddled with dodgy details. It claimed links to a firm of City stockbrokers that had already gone bust. It named a director who had quit months earlier. And the man behind the offering – Lee Farbrace – provided a list of his directorships which conveniently left out one of his companies that had promised ‘unparalleled low risk returns’ but within months had cost an investor £100,000.
The shares on offer were not even in Orange River Wealth itself. They were in a sister company called Orange River Capital. And while the 15 per cent fixed dividend was very attractive – assuming you got it – control of the company stayed with a different class of shares where the ultimate boss is, you’ve guessed it, Lee Farbrace.
Where has all the money gone? Well, Orange River Capital says it has bought a 49 per cent stake in Greengrow Capital, a medicinal cannabis plantation in South Africa. No audited figures have been provided, and according to Companies House, both Orange River Capital and Orange River Wealth have failed to file accounts that were legally due in May last year. This is an offence.
Your own very risky investment should never have happened. On paper, the shares you bought were only intended for wealthy investors or those sophisticated enough to know what they were doing and to afford the risks. You told the share salesman from Orange River Wealth that you knew what you were doing, but the truth was that you didn’t.
You were told to provide a signed certificate, giving details of the professional adviser who had discussed the investment with you, but there was no such discussion and you provided no such certificate. Orange River Capital should never have issued your shares. It is as simple as that. It should unravel the whole deal and return your £40,000. I asked Lee Farbrace to do this. He failed to answer. I also asked him to explain why you had been told to pay £19,200 of your £40,000 to a separate company called Phoenix Capital Investments. This company was set up in 2017, with no single person or firm controlling it. Almost three years later, according to Companies House, Lee Farbrace informed officials he was the controller all along. Again, Farbrace offered no explanation.
There was a response of a kind though. After I started asking questions, you received the proper share certificate you wanted, and Adam Collins, who describes himself as Sales Director of Orange River Wealth, sent you a one-page report. This lacked any financial details, but it did reveal that the company has professional advisers in the shape of FCA-authorised NextCrowd. Except that this is just another false claim.
Sacha Bright, who runs NextCrowd, told me it operates a crowdfunding platform but added: ‘We do not act as advisers to any firms.’ Orange River Wealth did want to link up with NextCrowd but failed to answer questions about its business.
I did ask Adam Collins about this false claim, but he offered no explanation. I also asked him what experience and qualifications he holds as an investment salesman, since his last job was as a car salesman. Again, he offered no comment. All this leaves you with shares you should never have been allowed to buy, and without the dividend you were told to expect. You could sue Orange River Wealth, or Orange River Capital, or both. But you might be throwing good money after bad. When I checked court records, I found both companies had unsatisfied County Court Judgments against them. Perhaps it’s time for an Insolvency Service investigation.