1 August 2024
Summary
Emil Nestor, the former Chief Technology Officer of In Touch Games Limited (ITG), has returned €6 million to Skywind Holdings Limited as part of a confidential settlement amidst ongoing legal disputes. This development follows allegations that arose after Skywind's acquisition of ITG in June 2022, which involved accusations of fraud, misrepresentation, and regulatory breaches. These issues were linked to ITG's compliance failures concerning anti-money laundering and social responsibility, uncovered during audits and regulatory scrutiny by the UK Gambling Commission. The settlement with Nestor resolves claims against him specifically, though legal actions continue against other former shareholders, Simon and Yu-Lin Wilson, over similar allegations.
Background of the Case
Skywind acquired ITG in June 2022 under a Share Purchase Agreement (SPA), purchasing the company from shareholders including Simon Robert Wilson, Yu-Lin Wilson, and Mr Emil Nestor. ITG had already been under scrutiny from the UK Gambling Commission due to alleged failures to comply with anti-money laundering (AML) and social responsibility (SR) obligations.
In the course of the sale, the defendants provided assurances regarding ITG’s compliance and financial status. However, after completing the purchase, Skywind alleged that these warranties were based on fraudulent misrepresentations, including claims that ITG had engaged in document forgery during a crucial audit, with the defendants accused of concealing material risks related to the company’s regulatory status.
Mr Emil Nestor’s Involvement
Mr Nestor, as a senior executive and shareholder in ITG, played a key role in the company’s operations. As part of the SPA, he received a substantial payment from Skywind as consideration for the sale of ITG. However, following allegations of fraudulent activities, particularly concerning the falsification of player bank statements and documents during an audit, the transaction came under intense scrutiny.
In 2023, after ITG’s operating licence was suspended by the Gambling Commission, further investigations and legal actions were initiated. During this time, Mr Nestor offered to return the €6 million he had received as part of the SPA.
The Return of Funds
In October 2023, Mr Emil Nestor voluntarily returned €6 million to Skywind under the terms of a confidential settlement agreement. This decision followed discussions with senior Skywind personnel and was prompted by the increasing regulatory pressure on ITG:
Initial Discussions:According to court documents, Mr Nestor first expressed his willingness to return the funds during meetings with Skywind executives in September 2023. He indicated that he felt regret over the situation at ITG and wanted to return the money as a gesture of good faith.
Assistance with Investigation:In addition to returning the funds, Mr Nestor cooperated with Skywind’s efforts to respond to the Gambling Commission’s investigation. He provided key information, including a computer script used to generate reports on customer accounts, which later helped Skywind uncover irregular activities within ITG’s system. This cooperation was seen as an important step towards resolving the matter.
The Settlement:On 13 October 2023, Mr Nestor formally returned the €6 million to Skywind. This payment was made as part of a confidential settlement agreement, which resolved certain claims against him. As a result, Skywind confirmed it would not pursue further legal action against Mr Nestor, though its case against Simon and Yu-Lin Wilson remains active.
Implications of the Settlement
Mr Nestor’s return of €6 million is a pivotal moment in the ongoing legal dispute between Skywind and ITG’s former owners. While this settlement resolves the claims against Mr Nestor, several key points emerge:
Acknowledgement of the Dispute:Although Mr Nestor has not admitted any wrongdoing, his voluntary return of funds indicates an acknowledgment of the broader legal and regulatory challenges surrounding the sale of ITG. His actions suggest a desire to dissociate himself from the more serious allegations facing the other defendants.
Impact on Other Defendants:With Mr Nestor no longer part of the case, focus shifts to Simon and Yu-Lin Wilson, the remaining shareholders implicated in the sale. Skywind continues to allege that the Wilsons were aware of, and participated in, fraudulent activities during the sale, including the manipulation of player financial records during the audit. Mr Nestor’s cooperation may provide further evidence to support Skywind’s claims against the Wilsons.
Regulatory and Legal Consequences:Mr Nestor’s return of funds does not resolve the broader regulatory issues facing ITG. The Gambling Commission’s suspension of ITG’s operating licence remains in place, and the company continues to be under scrutiny. Additionally, Skywind’s claim for damages against the Wilsons remains unresolved, with significant financial consequences potentially awaiting the remaining defendants.
Conclusion
Mr Emil Nestor’s return of €6 million to Skywind marks a significant development in the ongoing legal proceedings surrounding ITG. While the settlement brings Skywind’s claims against Mr Nestor to a close, it underscores the gravity of the allegations concerning ITG’s sale and operations. As the case against Simon and Yu-Lin Wilson progresses, further details may emerge about the extent of the alleged fraudulent activities and the potential legal ramifications.
This case serves as a stark reminder of the importance of transparency and regulatory compliance in the gambling industry, particularly for operators subject to the oversight of the UK Gambling Commission. As the legal proceedings continue, the implications of these allegations for the parties involved, and for the wider gambling industry, will become clearer.
It is suggested that Mr Nestor received approximately £11.6m from the Skywind acquisition and likely retained approximately £9.3m after capital gains tax is accounted for. According to documents available to GAMSOL, Mr Nestor repaid €6m (£5.1m) to Skywind on 13 October 2023 in settlement of Skywind's claims.
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