Brain Games Controversies
- In 2000, Keene's former brother-in-law David Levy accused him of deceiving the directors of their company Mind Sports Olympiad Ltd by setting up a rival company Brain Games Network PLC without their knowledge and using £50,000 of MSO Ltd money to do so. Levy further alleged that Keene changed his story several times as to the purpose of the payment and the reasons why the new company had been set up. He complained that shares in the new company were held by Keene and an associate (Don Morris) but by not the company for which they had been supposed to be working, nor any of its directors other than themselves. Levy wrote:
As one would expect, our original investors were equally astounded at the news and extremely angry at Keene. They had by now invested £1.5 million (approximately $2.25 million at that time) partly or largely on the basis of their faith in Keene and myself. Now they had learned that one of their two key consultants, the one with money raising skills, had been working to set up a rival company.Nothing, however, was proven against Keene (who had swiftly paid an identical sum, i.e. £50,000 to MSO, making the subsequent explanation that this constituted a personal loan from himself) and his new company went on to organise the world championship match later that same year. (It was at this time that Private Eye started referring to him as The Penguin, a nickname he had first acquired in 1966.)
- Levy further criticised Keene for selling three of his own companies to Brain Games Network PLC (BGN) for £220,000 despite their being "virtually worthless". The three companies had between them "a total capital and reserves of only £2,300". At much the same time, according to Levy, BGN purchased a web site and two domain names from Chess and Bridge Limited. However, they made the purchase in two stages. The first of these stages was its sale to Giloberg Finance Limited, owned by Keene's associate Alan Lubin: the second was the immediate sale of the same items, by Giloberg, to BGN. The first sale was for approximately £60,000 (in fact $100,000) and the second was for £290,000, hence making Giloberg "an instant profit of approximately £230,000" and raising the question of why BGN should have paid a sum much greater than the original vendors considered the items were worth.
- BGN collapsed in controversial circumstances. Shareholders were unhappy that sums amounting to at least £675,000 had been paid to directors in "fees and payments" despite the company swiftly becoming insolvent. Investors were also unhappy that Keene and Lubin had acquired 88% of the company "for a song" even though the remaining 12% had been sold for around £3 million.
Read more about this topic: Raymond Keene
Famous quotes containing the words brain and/or games:
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