Just two months ago, London-based digital financial company Stenn Technologies was lauding its expansion across the pond after establishing its U.S. headquarters in Midtown’s Colony Square.
But now, the future of the company is unclear as the British parent company faces insolvency and media reports of fraud and money laundering swirl.
Stenn Technologies is a global fintech group founded in 2015 that lent money to finance short-term gaps for e-commerce and international trade businesses. In 2022, Stenn said it was valued at $900 million. The company had clients in more than 75 countries and more than 200 employees globally.
On Dec. 4, two of Stenn’s U.K. entities were suddenly placed under administration following a British court order, which is similar to bankruptcy in the U.S. An appointed third-party is now overseeing the entities’ operations in order to stabilize them and “take all necessary steps to preserve value,” according to a statement from the administrators posted on Stenn’s website.
The U.S. entity, Stenn Assets USA Inc., remains under the control of its directors and is not subject to the British administration process, according to Noel Hillman, Stenn’s chief commercial officer based in Atlanta.
But Atlanta employees have been locked out of their company email and laptops since last week and have not received any communication from leaders about next steps or if they’ll get paid this week, an employee in Atlanta who did not want to be named because of the potential impact on future job prospects told The Atlanta Journal-Constitution.
A representative for Stenn declined to comment. Hillman wrote in a message to the AJC that the company’s leaders “are still working through what the options are for (the U.S.).”
“My concern in all of this (is) our people and our customers and providing the best outcome for both of those,” he said.
Signs of trouble started on Dec. 2, when employees were called into an impromptu all-hands meeting with Stenn’s CEO, Greg Karpovsky, according to the Atlanta-based employee. Karpovsky told employees the company had received an unexpected letter from one its investors, the banking giant HSBC, and that for the time being, to stop financing any new deals.
Two days later, employees were called into another meeting with the CEO who told them briefly that the company was now under administration and then turned the floor over to the administrators from a company called Interpath, who would be overseeing Stenn, according to the employee.
But almost immediately after the meeting was over, everyone was locked out of company laptops and messaging systems, with no official communications from leaders since, the employee said.
The order for administration reportedly came after a unit of HSBC discovered potential irregularities in Stenn’s transactions, according to Bloomberg, which cited unnamed people familiar with the matter.
HSBC began probing the company’s transactions after Stenn was referenced in a U.S. criminal indictment about a Russian money laundering scheme, the Financial Times reported, citing unnamed people familiar with the situation.
HSBC did not respond to requests for comment.
In the past week, LinkedIn has been filled with Stenn employees across the globe saying they are looking for new jobs, an about face for a company that was rapidly growing months ago. The Atlanta-based employee said they have also started job searching.
In an interview in October, right before the Atlanta Stenn headquarters was set to open, Hillman was bullish about the company’s growth, saying Stenn had added about 30 people in Atlanta in just a year and was planning to hire about 30 more over the next few years.
Stenn’s Colony Square office is inside of Spaces, a coworking space. Its membership agreement is still active.
— Staff writer Zachary Hansen contributed to this report.
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