WorldSpreads Caught Evil Knievil Off Guard
Simon Cawkwell, a British stock market commentator and author known as “Evil Knievil” was caught in the Worldspreads collapse with a £150,000 claim.
Worldspreads is under administration after the new management team discovered accounting irregularities and a shortfall of £13m to pay all clients. Although the Financial Services Authority (FSA) requires client funds to be segregated, Worldspreads didn’t comply and KPMG, the designated administrator, will have a hard time to pay all claims to the 5,000 active clients the company had.
“Evil Knievil” is the first well-known figure to be on the list of creditors. Since his claim is above £50,000 he is not fully protected by the Financial Services Compensation Scheme and will most likely have difficulties to recover the extra £100,000.
Commenting on the situation, Mr. Simon stated:”My total losses from failed stockbrokers and spread-betting firms over the past four years is around £1m.” He also added that he made more than £1m trading commodities at Worldspreads last year.
Simon Cawkwell is known by his short-selling activities. He has been betting against companies he think the price will fall. He became well-known after he exposed the fraud of Robert Maxwell’s accounts. He made a huge fortune betting against Maxwell’s Communication Corporation.