The sharp conflict between business groups over the control of the consumer credit provider Fair Credit Czech is also an inconvenience for two other companies that, in addition to Fair Credit, fall under the supervision of the Czech National Bank.
Specifically, it is the CFH investment fund and the Delta investment company that manage this fund. The CFH fund poured 485 million crowns into the Fair Credit Czech company from investors’ money.
“Our investment company is unpleasantly surprised by the sequence of changes that have taken place around Fair Credit Czech during the last few days. Due to the turbulent changes within the ownership structure of the FCC and the subsequent filing of an insolvency proposal, we cannot comment on the situation at the moment,” said Peter Koždoň, Chairman of the Board of Directors of Delta Investment Company.
“Nevertheless, we are monitoring the situation very carefully and, together with legal representatives, we are evaluating possible impacts and risks for the CFH investment fund and its investors. We are trying to get the maximum amount of information and, of course, we will inform the CNB about what is happening,” added the head of Delta.
Repayment of loans
The loans from the CFH fund were already repaid last fall, when a group of companies originally connected to Fair Credit Czech ran into serious financial problems.
Since then, Delta, as fund administrator, has been trying to find a solution to get out of the quagmire. But no agreement was concluded. However, the sale of the claim against Fair Credit Czech is also considered.
“We have approached important players on the market regarding the sale of receivables for Fair Credit Czech and we are now waiting for offers,” noted the head of the board of directors of Delta investment company Koždoň.
According to the register of beneficial owners, the sole owner of the CFH investment fund is businessman Martin Nejedlý. (Entrepreneur Martin Nejedlý has nothing to do with Martin Nejedlý, who was an advisor to former president Miloš Zeman, editor’s note). According to the commercial register, the entrepreneur is the chairman of the fund’s supervisory board.
Suspension of transactions
In addition, Nejedlý was the majority shareholder of the former Fair Credit group last fall. That is, the holding company, into which money received from investors through investment shares flowed from the CFH fund. Until October 2022, the former Fair Credit group also included the licensed company Fair Credit Czech.
Due to the situation in Fair Credit, the management company Delta decided a year ago to suspend transactions with investment shares of the CFH fund. Since then, it has repeatedly extended this decision. The last time was this September.
The CFH fund was a significant conduit of money to the former Fair Credit group, but by no means the only one. The fallen holding also attracted small investors to other unregulated financial instruments. The exact amount collected from investors in the group is not known. Last year, Martin Nejedlý only admitted that liabilities for roughly one billion crowns are at risk.
The case of the former Fair Credit group
The editors of SZ Byznys have been following the events surrounding the former Fair Credit group for a long time. Here are the reports we’ve released on the case so far: