Amy GallimoreRecent updates from Stenn’s administrators have cast light on the hasty demise of the London-based fintech business, which continues to generate considerable interest.
Kristina Kicks, Joshua Dwyer and James Tucker of Interpath Advisory were appointed joint administrators of two UK units of the invoice financing business – Stenn Assets UK Ltd and Stenn International Ltd – by the High Court on 4 December 2024 following an application by secured creditor HSBC. Both Stenn companies are ultimately owned by Stenn Technologies in Luxembourg. The group has further links to Ireland, the US, Spain, the BVI and China, where many of its customers are located.
In HSBC’s submissions to the court in the administration application, it alleged that Stenn had received numerous payments from entities with the names similar to those of global blue chip companies, but in reality had no connection to these companies, and noted potentially suspicious transactions involving customers in Taiwan and Japan.
Stenn had been under investigation by HSBC after it was mentioned in a US criminal indictment concerning alleged Russian money laundering. In particular, US authorities alleged that Stenn Assets UK had received $1.7m from a Singapore company linked to a Russian citizen who last year pleaded guilty to running an unlicensed money transmitting business. Neither Stenn nor its Russian founder Greg Karpovsky were accused of wrongdoing in the US case. Karpovsky was previously a director of digital payments company Silverbird Global Limited, which itself entered special administration on 13 March 2024, with Daniel Conway and Geoffrey Rowley of FRP Advisory appointed joint special administrators under the Payment and Electronic Money Institution Insolvency Regulations 2021. Silverbird provided foreign exchange and payment services to corporate clients, but experienced difficulties after the discovery of potential historic sanctions breaches led to the withdrawal of venture capital investment.
Insolvency filings for Stenn have now identified around a £100m shortfall to creditors. The administrators are focusing on a range of matters in their investigations, including its business structure, treatment of financial assets, and the provenance and allocation of several millions of dollars in company accounts. Stenn, which was valued at $900m in 2022 and was backed by American private equity group Centerbridge, continues to collect its outstanding receivables (totalling $119m as at November 2024), although the administrators have suspended any new business. 44 employees remain to assist with this process after 200 were made redundant in December as a result of the administration. The amount that HSBC will receive of its $35.3m outstanding liability is, as with other creditor claims, currently uncertain.