VELTYCO GROUP: Offshore Ties and Related Party Dealings Raise Questions

From Gaming to Crypto: A German-Backed UK Company

VELTYCO GROUP PLC, a UK-listed entity with interests in gaming, betting, and gambling, shifted its focus to blockchain and crypto ventures in late 2017. This announcement triggered a notable increase in its share price during December of that year.

At its core, however, VELTYCO remains a German-driven enterprise orchestrated by Uwe LENHOFF, who until recently served on the board. Although he officially stepped down during a board reshuffle, LENHOFF continues to operate behind the scenes as VELTYCO’s most influential shareholder and business strategist. Many of the ventures tied to the company originated in Germany and Austria, often executed via offshore vehicles.

Among the notable moves was the acquisition of majority stakes in the Cologne-based Bet90 and eSports.com AG, both tied to LENHOFF and his network.

2017 Financial Report Highlights Questionable Dealings

VELTYCO’s audited results for the 2017 fiscal year revealed a striking increase in revenue and profits — but also an alarming surge in unpaid receivables.

Financial Highlights (2016 vs. 2017)

The disproportionate growth in trade receivables compared to revenue and profit raises red flags — particularly since most of the outstanding amount is owed by ALTAIR ENTERTAINMENT N.V., a shadowy offshore company linked to the LENHOFF network.

ALTAIR, based in Curaçao, serves as a marketing and gaming services provider for various websites, including KULBET. Despite being one of VELTYCO’s largest debtors, ALTAIR has no online presence and appears in the Offshore Leaks Database.

Several brands operated through ALTAIR or its affiliates, such as Option888, have been targeted by regulatory bodies, including BaFin in Germany.

Undisclosed Transactions: The WINSLET ENTERPRISES Case

In June 2018, VELTYCO admitted a breach of AIM regulatory rules due to an unreported related party transaction. The company acknowledged that WINSLET ENTERPRISES LTD, fully owned by Uwe LENHOFF, entered into a loan agreement with Bet 90 Sports Ltd, a VELTYCO subsidiary.

“VELTYCO became aware, during its 2017 audit, that Winslet was entirely owned by LENHOFF, who at the time was still a director. The loan and related agreements should have been disclosed under Rule 13 of the AIM Rules.”

Following this disclosure, LENHOFF resigned from his directorship.

Behind the Numbers: Illusion of Profitability?

The company’s rapid financial growth appears closely tied to transactions with related offshore entities, many of which are connected to LENHOFF.

Revenue was recorded from invoices issued to related parties, but payments were often delayed or missing. This created the appearance of profitability without actual cash flow — an unsustainable practice that casts doubt on the company’s fundamentals.

VELTYCO’s auditors flagged material uncertainties regarding the company’s ability to continue as a going concern, primarily due to its high exposure to non-paying related entities. Many of these offshore firms lack websites, offices, or transparency, and are managed through nominee structures.

Liquidity Crisis and Corporate Restructuring

The company’s dependence on its offshore partners placed it in a precarious financial position. The 2017 annual report notes disruptions in VELTYCO’s banking relationships and reveals a full restructuring of its executive team, with Melissa BLAU appointed CEO in March 2018.

Efforts were then made to recover debts owed by LENHOFF-associated firms such as ALTAIR, PAYIFIC Ltd, and Winslet Enterprises Ltd. The report noted a reduction in receivables from ALTAIR to €3.4 million, primarily via non-cash settlements — emphasizing the liquidity issues.

VELTYCO closed the year with a negative cash flow of €3.6 million, which had to be covered through capital increases and a loan. Without these measures, the company risked insolvency due to LENHOFF’s companies failing to meet their obligations.

Dividend Amid Financial Pressure

Surprisingly, despite these challenges, VELTYCO announced its first-ever dividend: 0.25 pence per share.

This move raised eyebrows among shareholders, many of whom expressed dissatisfaction with the company’s operational opacity and its long-standing entanglement with the LENHOFF network.

Conclusion: Growth at a Cost

VELTYCO’s 2017 surge in revenue masks a deeper issue — its reliance on complex, opaque transactions with offshore firms controlled by a former board member. These related party dealings, undisclosed agreements, and questionable cash flows have led to scrutiny from auditors, investors, and regulators alike.

As the company attempts to restructure and regain financial stability under new leadership, the legacy of its offshore business model may continue to cast a long shadow.