Chequepoint's owners don't exist

The recently closed exchange offices have not had a legal owner since 2016

The owners of the exchange company that was recently shut down by the Czech National Bank (ČNB) are proving hard to find.

Chequepoint had its license withdrawn by the ČNB two weeks ago and was issued a fine of Kč 1.2 million, but it is not clear who will pay as its owners seem to not exist in any legal sense.

The company's only shareholder, Cypriot company Chequepoint Group, based in Limassol, has not existed for two and a half years, according to the business portal Financial and Economic Information (FAEI.cz).

According to Cypriot databases, the company registration expired Jan. 11, 2016. No new owner has been registered.

The exchange place became the focus of a series of videos by Janek Rubeš, who posts to YouTube as the Honest Guide. He pointed out to very poor exchange rate offered by the company, despite its claims to have no commission. The exchange rate offered was around Kč 17 per euro, while the actual rate is closer to Kč 26 per euro.

When Rubeš was making one of his early videos this year about the exchange, a legal letter telling him to stop his actions was sent by messenger to him as he stood on Old Town Square, so there was an entity looking after the interests of the company. Who that remains unclear.

“It is possible that the company's owner changed in the meantime, but Chequepoint did not include this change in the business register. Besides, the company last fulfilled its statutory obligation for publishing an annual report in 2014. The company probably did not bother to fulfill other important obligations, including adapting for current legislation or for the liquidation of the earlier, company,” Smart Office & Companies manager Michael Dobrovolný said, according to a report on FAEI.cz.

Annual reports for 2015 and 2016 were not available to the ČNB, which the bank pointed out in January, when it was previously trying to assess fines but lacked sufficient information about the company assets.

When the last annual report was filed on Oct. 14, 2016, the Cypriot owner already did not exist for nine months. The report, signed by a board member, did not mention any substantial information about the defunct Cypriot shareholder or any new owner.

The annual report also had other strange aspects regarding interest-free loans, according to the FAEI.cz report. These raise questions about the relationships between the companies involved in the loans and whether standard market rules were followed.

The 2014 annual report also stated that for technical reasons regarding its ownership, the company was not required to file consolidated financial statements at the Czech level.

Failure to file the required reports is not unique to Chequepoint. Business consultancy Bisnode said recently that some 45 percent of companies in 2015 have not met their obligations for publishing information, and for 2016 that figure was up to 51 percent.

Pending legislation should address this situation by including the possibility of revoking the company's status if it fails to comply for two accounting periods, and fails to meet other requirements.

Companies often fail to comply with reporting in an effort to keep business secrets and protect privacy so they can be more competitive. 

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