Spanish internet company Let’s Gowex SA said that for nearly 10 years it was making money by providing public wi-fi in cities around the world and most of the contracts, it now emerges, never existed.
Gowex chief Jenaro Garcia Martin also used a series of tricks to fool company employees, investors and regulators. Last month the discovery of the deceit crippled the company and undermined credibility in Spain’s stock market just as the country recovers from a four-year recession.
Spain’s judicial system has charged him with financial crimes, including false accounting. The judicial system does not require a formal plea and Garcia Martin has not given one. On July 14 while testifying before Spain’s High Court he admitted how he used to manipulate the company’s accounts and also explained how he used a network of about 20companies to generate a paper trail of fake business and fake contracts that he used to raise capital.
To help cover his tracks, Garcia Martin reported fake revenues from shell companies