Neo & Bee employees expose truth about Danny Brewster

In the Neo & Bee story, we always heard the voices of Danny Brewster or the Cypriot police. What about the employees? When a company is in trouble, it’s usually the working force that brings out the truth. Loyal as they are, they waited with this. Hoping a solution would come over time. But as time goes by, so diminishes hope for a good outcome. Today, the employees of Neo & Bee stood up and shared their version of the events.

The two spokesmen are George Papageorgiou, former Neo & Bee COO and Øystein Aaby, former Compliance and Risk Management Officer. They speak for all the personnel that was involved at an executive level within Neo & Bee. Their story comes after Danny Brewster wrote his own public letter. The employees remained silent, hoping that the company could be turned around. After reading the mistruths and outright lies, silence was no longer an option.

This letter answers many questions and makes Brewster look bad. Especially taking his own version of events into consideration. Hold on tight, this story is not pretty, not at all.

Misled by a CEO running rampant

“We were misled, and the truth was obfuscated from us under so many layers, that combined with our workload, proved enough to allow the CEO to run rampant, without accountability and with full control of all the bitcoins, until it was too late. The following are the facts witnessed and attestable by senior management at Neo & Bee Ltd. It is most of what some of us have personally testified with all existing documentation, to the local authorities. Anyone willing to verify these should please contact them.

Danny Brewster is the sole Director, shareholder and CEO of the group of companies. He was solely responsible for raising approximately 9.400 bitcoins prior to hiring any employees through crowdfunding on multiple platforms. Once we assumed our duties, we repeatedly made requests regarding transparency of bitcoins in the company’s possession so that the CFO could perform his duties. The CEO never divulged specific documented information regarding the IPVO bitcoins and amounts. To this date, and unless further information is revealed by Danny Brewster, the CFO is unable to account for the majority of bitcoins allegedly expended. Danny Brewster was the sole custodian of funds raised from the IPVO and despite repeated requests from both the CFO and Compliance and Risk Management Officer, he consistently deflected and delayed any attempts to have the coins witnessed or accounted for – increasing concerns leading up to the events of March 19th.”

Appointing a CFO seems rather strange when the CEO solely keeps control over the company’s funds. Even better, raising 9,400 Bitcoins is impressive but what good are they if no other employees knows where they are or what they are used for? Are they still in Brewster’s control? A company can only work when there is transparency in all layers. The company’s employees work every day to ensure quality services. They deserve to know what drives the company and how the future looks. Constantly avoiding questions and thinking of excuses feeds concern and ultimately leads to events like what Neo & Bee witnessed on March 19th.

Losing 4,260 Bitcoins in one day

On March 18th, Brewster told a member of the management team that the company had 5,000 Bitcoins remaining. Where did the other 4,400 Bitcoins go? They magically disappeared? I guess if a company can suddenly find a lost wallet with 200,000 Bitcoins in it, losing one with 4,400 Bitcoins should be a piece of cake. March 19th, Brewster called a meeting for all of the senior management team, informing them that the company was down to its last 140 Bitcoins. Wow, things seem to change fast at Neo & Bee headquarters.

“Tuesday 18th of March Mr. Brewster told a member of the management team that the company had 5000 Bitcoins remaining. This directly goes against what was said the following day.

Mr. Brewster called a meeting for all of the senior management team on the 19th of March in which he informed us that the company was down to its last 140 bitcoins. Mr. Brewster proceeded to give a very rough and incoherent breakdown of where the funds had been spent. After revealing the lack of funds to his employees he went on to raise the possibility of selling more “profit shares” to increase liquidity. All employees sternly objected to this and the idea has since not been raised since. In defence of the sudden announcement on the 19th of March that the company only had 140 bitcoins remaining, Mr. Brewster stated in front of the same people that he had mis-accounted for 5000 of his own bitcoins, bitcoins he thought he owned but after “checking” a wallet, realised had actually spent them all.”

The employees rightfully ask themselves the question why Brewster’s personal finances are relevant to the financial situation of the company. On the other hand, his own Bitcoins are none of our business so no further questions there. Onwards to the next statement. Brewster claimed an amount between 1400 and 1700 of the company’s Bitcoins were lost in We-exchange/Bitfunder. That being so, Brewster added none of the company’s coins were lost in Mt. Gox. This seems to be another lie. On that particular March 19th meeting, Brewster told the management team that Neo & Bee had lost 2480 Bitcoins in Mt. Gox.

So was he trading company funds at exchanges? He told his employees he was not but somehow that seems hard to believe. The employees feel the same way about this.

“His personal investment in the company (claimed in an older newspaper interview) varied upwards to 6 million (assuming Euro). There is no logical trace of this investment or where it was spent. At the same time, it appears to us, that he customarily made payments through his Bitstamp account to creditors, and many of us have multiple indications that he was trading there and in every other major exchange. When asked, he always replied that it was his personal holdings. There are conflicting statements from him, which indicate that he never separated the company funds from his personal. Bitcoins lost in the exchanges were at some points reported to be his, and at other the company’s.”

A few days after the meeting, Brewster left for the United Kingdom. His management team made very clear to him that they did not want to continue with Brewster as CEO. He agreed to step down after transferring control of the company to investors. He boarded a plane, planning to speak to investors in the United Kingdom. No one was able to contact him until the 28th of March, when he wrote that he had to remain silent. He received threats against his daughter’s life. The girl was still in Cyrpus but nevertheless the Neo & Bee employees contacted local authorities about this. The Cypriot police said that they have not heard anything about that matter before. Strange, Brewster said he tried to contact the police several times without success.

Adding insult to injury

This all moves towards the day when Brewster posted his public letter on Reddit. Needless to say, this caused lots of emotions at the Neo & Bee office in Cyprus.

“He posted his reply on the morning of the same day, causing an outrage of the personnel and management that were in the office, still waiting for any coherent response and a way forward. No documentation regarding the bitcoins he supposedly has accounted has reached the personnel of the company, despite the numerous demands from us, and claims from him that they “are all accounted for”.

Claiming that the threats may have originated within the company is simply adding insult to injury. The people that worked ceaselessly and tirelessly over long hours and weekends, the same people that said they would go unpaid for months when he said he had no more bitcoins, the same people that tried to save his brand, willingly working for an increasingly unlikely wage while he was away, were suspect for threats in his books. For all of the above reasons, upon reading his last response, everyone in the company filed our resignations to be forwarded to the local Registrar of Companies, in absence of the CEO.”

A slap in the face of people that were willing to give everything for a once promising company. Right now, Brewster is still in the United Kingdom. He still has control over what is left of the supposed 140 Bitcoins, the remaining company’s funds. He personally sold Bitcoins to local Cypriots and staff and remained personal custodian of these coins. These are now unaccounted for, and the management team had to face these creditors. A management team that was unaware of said transactions between Brewster and these people. The management team fears there are more people that entrusted their coins to Brewster for safekeeping. Chances are their coins have vanished too. They invite every one of these persons to step forward and present said evidence to the authorities.

“He is also in possession of personal bitcoins of two employees (~50 bitcoins), as well as at least the bitcoins of multiple other people who bought from him as mentioned above, and entrusted their coins to him for safekeeping. While we now know that one of his cars has changed owners Mercedes and the Bentley is in a car dealer with other plates (probably sold as well), he has remained silent, despite having clearly said that potential funds from selling the cars would go to paying salaries and creditors.

Which brings us here. We will remain in contact with the community and authorities to clear this situation out to its full extent. This was the doing of one person in full control of a business’ funds, not technology and certainly not Bitcoin’s. What we face, is in its core, a corporate governance failure, pervasive in conventional businesses even more often than it is in Bitcoin businesses. Contrary to conventional businesses, where regulation is the only response, the tools are available here, to ensure in the future that these things don’t happen.”

You can read the full letter here. Most of the information is provided in this article, but it’s still a good read. This letter sheds a totally different light on the Neo & Bee situation, and I want to express my gratitude to the employees for coming forward. In a case where everyone is waiting to get paid, this is not an easy step to take.

I wonder if Brewster is going to provide an answer to this. If all of this is true, the only thing left for him to do is to write a long letter of apology.

Last modified (UTC): April 18, 2014 15:21