We review Symtomax’s bonds paying 30% over two years for investing in cannabis

Symtomax is offering bonds paying a 30% return over 24 months – 12% in the first year and 18% in the second year.

There is an option to exit the bond after 1 year. However this assumes that Symtomax will have sufficient liquid funds to repay investors who wish to exit.

Who are Symtomax?

Symtomax is incorporated in Portugal as Symtomax – Unipessoal Lda (Unipessoal translates as “sole proprietor”) and in the UK as Symtomax SPV.

Minette Coetzee is the sole owner of the UK subsidiary and listed on Symtomax’s website as CEO and Founder.

According to her LinkedIn bio, Coetzee was previously Managing Director of Atlantis Advice Bureau and a Director of The Mareeba Group. Both are obscure Gibraltarian companies about which there is very limited publicly available information.

How safe is the investment?

Adverts for Symtomax’s bonds sent via email and Facebook claim the investment offers “Asset Backed Security” and that “the investment is Brexit proof”.

Secured lending is not risk-free as there is a risk that if the underlying borrower defaults, the security cannot be sold for enough to cover the loan.

Investors in asset-backed loans have been known to lose 100% of their money when it turned out that there were not enough assets left to pay investors after paying the insolvency administrator (who always stands first in the queue).

We are not in any sense implying that the same will happen to investors in Symtomax, only illustrating the risk that is inherent in any loan note even when it is a secured loan.

If investors plan to rely on this security, it is essential that they hire professional due diligence specialists (working for themselves, not Symtomax) to confirm that in the event of a default, the assets of Symtomax would be valuable and liquid enough to compensate all investors. Investors should not simply rely on what Symtomax tells them about their assets.

Symtomax claims in its investment literature that it has a “95 hectare facility, producing 700,000kgs Comparison site with a market capacity of $9.28bn, the current market leader.” [sic]

Claiming to be able to produce $9.28bn worth of cannabis is a big claim for a startup company whose website was nothing but a placeholder as recently as August 2018.

Symtomax’s claim to be “Brexit proof” is extremely dubious as it is a Portugese company offering bonds in Sterling to UK investors.

Should Sterling rise from its current record lows, it will cost the company more to repay its already-very-expensive bonds.

Political involvement

According to a press release, Symtomax has recently hired the former State Secretary for Health and President of Portugal’s health regulator Infarmed, Dr Eurico Castro Alves, as director of Symtomax.

Whether the President of Portugal’s health regulator should be working for a pharmaceutical producer, given the potential conflict of interest issues is a question I will leave to the regulator.

For investors, the thing to remember is that legitimacy by association is not a substitute for due diligence.

The fact that a government official has joined the board does not make an investment paying 12-18% per year any less high risk.

Should I invest in Symtomax?

This blog does not give financial advice. The following are statements of publicly available facts or widely accepted investment principles, not a personalised recommendation. Investors should consult a regulated independent financial adviser if they are in any doubt.

As with any individual loan note to an unlisted startup company, this investment is only suitable for sophisticated and/or high net worth investors who have a substantial existing portfolio and are prepared to risk 100% loss of their money.

Any investment offering returns up to 18% in a year is extremely high risk. As an individual, illiquid security with a risk of total and permanent loss, Symtomax’s loan notes are much higher risk than a mainstream diversified stockmarket fund.

Before investing investors should ask themselves:

  • How would I feel if the investment defaulted and I lost 100% of my money?
  • Do I have a sufficiently large portfolio that the loss of 100% of my investment would not damage me financially?
  • Have I conducted due diligence to ensure the asset-backed security can be relied on?

If you are looking for a “secure” investment, you should not invest in corporate loans with a risk of 100% loss.

8 thoughts on “We review Symtomax’s bonds paying 30% over two years for investing in cannabis

  1. We echo the comments described above. We have no evidence to suggest that this investment is going to fail, but we don’t like investment brochures which do not tell the truth. That is never a good sign.
    Symtomax is being very heavily promoted in the Far East to Malaysian, Hong Kong and Chinese investors. The front man at Symtomax is David Mace. The brochures bang on about his role at GW Pharmaceuticals and how he was integral to its success. For those who don’t know, GW Pharmaceuticals was a hugely successful company which, as part of its diversified portfolio, had an interest in medical cannabis farms in the early days.
    We happen to know some very senior people at GWP so we asked one of them about David Mace. His response was that he remembered David. He said that David was an investor who, by virtue of his investment, was given a minor position in the company. Our contact was on the Board of the company. He said “whilst I knew him I can say with certainty that he was not a decision-maker in the company and was never invited to attend any Board meetings”. This suggests that Symtomax are exaggerating David’s role and importance. Our guy also said that a cannabis farm may sound great, but the only way to make it profitable is to ensure that you get six harvests per year. Anything less and it won’t make any money. He questioned whether David Mace has any experience in this field.
    In brief we think that Symtomax intends to take an empty field, use investor money to prepare it, install irrigation, construct the essential buildings, buy the necessary farm equipment and plant it with cannabis. This means that investors are not backing a proven company which can easily cover the interest rates and the repayment of capital. Investors are financing a brand new business with all the risk that this entails. The majority of new businesses fail within the first two years.
    We are concerned that Symtomax has issued a very risky bond without being entirely honest with investors. Bonds give investors no protection. This is a new business investment so it really should have been a share offering. Shareholders have much greater rights than bondholders in the event of failure and get to share in the profits if the investment is successful. It would not surprise us to find that the founder(s) will have been repaid all of their investment capital from the payments made by investors meaning that the founder(s) have no risk going forward. All the risk will be with the bondholders.
    Symtomax is too dangerous and investors should give it a wide berth.

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  2. “We are concerned that Symtomax has issued a very risky bond without being entirely honest with investors. … Symtomax is too dangerous and investors should give it a wide berth.”

    This can be said of pretty much every bond reviewed by Brev!

    High risk, unregulated bonds have become the “new black” for scammers. Trouble is, no one is stopping them! The FCA are completely useless! I would go so far to say, it would not surprise me to learn the fonuders have not only been repaid their capital investment (if any) but plenty on top of that.

    The question is who is promoting the investment and to whom is it being promoted? There are legal restrictions and I wouldn’t be at all surprised to learn it was being promoted to unsophisticated, low net worth individuals unlawfully! It’s only the vulnerable that fall for this kind of hype!

    It’s just a matter of time before Brev is reporting on its failure and the appointment of blood sucking administrators who will issue the usual warning there is no money left for investors – just barely enough for the blood sucking administrators and lawyers!

    Liked by 1 person

  3. The Mareeba Group was linked to the Kijani Commodities Fund – an alleged ponzi scheme that I believe collapsed with zero value. When I say linked – this is according to Offshore Alert – William Redford was a director and was also a director of a number of the entities linked with the Kijani fund.

    I am also wondering whether Minette Coetzee is the same person as Minette Compson – Coetzee being a South African name and MInette Compson being South African and both born in March 1971. Minette Compson was barred from acting in finance roles by the GFSC in Gibraltar (http://www.gcs.gov.gi/images/judgments/supremecourt/2015/minette_compson_v_the_chief_executive_officer_of_the_financial_services_commission_and_ors.pdf) for her role in permitting a property fraud that collapsed the Advalorem fund – the same mechanism that permitted Gregory King to bleed Heather Capital dry of £400 million.

    It’s a small world – you never know.

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  4. Checking my facts, Minette Compson was a director of Ratio Private Client Fund PCC Limited, the Mareeba Group and the Advalorem fund alongside William Redford.
    The Minettes Coetzee & Compson who share the same birthday, have strong links to Gibraltar and were both apparently directors of the Mareeba Group must be really good friends with so much in common.

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  5. Depends on which version you believe, its is def her again though Didn’t take a lot of research though. Good luck putting money here its just another Kijani Fund where everybody (including me) lost all our money.

    Symtomax is managed by CEO and Founder Minette Coetzee, whose entrepreneurial instincts and vision have rapidly positioned them as a major powerhouse in the cultivation world within the European Union.

    or

    Financial Services Commission, PO Box 940, Suite 3, Atlantic Suites, Europort Avenue, Gibraltar. Tel: +350 200 40283, Fax: +350 200 40282.
    Decision Notice
    FINANCIAL SERVICES (INVESTMENT AND FIDUCIARY SERVICES) ACT (“the Act”)
    Notice of a direction given under section 35(1A) of the Act.
    I hereby give public notice under sections 36(4) and 46(b) of the Act that on the 12th December 2014 I have directed pursuant to section 35(1A) of the Act that Minette Compson is under an obligation not to perform the following functions in relation to Castellum Corporate Services Limited, Castellum Fiducia (Nominees) Limited and Castellum Secretaries Limited, being companies licensed to carry out investment business or a controlled activity under the Act, or any other person licensed under the Act to carry out such business or activity:
    (i) Shareholder controller;
    (ii) Director; and
    (iii) Any other function, responsibility or requirement of the Financial Services (Conduct of Fiduciary Services Business) Regulations 2006
    consequent upon my decision that the said Minette Compson is not a fit and proper person to carry out the afore-said functions for the reason that, having a duty to do so, she failed to ensure that Advalorem Value Asset Fund Limited (an Experienced Investor Fund) was being operated in manner that was not detrimental to the interests of its participants or potential participants and in compliance with its Private Placement Memorandum. Minette Compson was a director of Advalorem Asset Management Limited, itself a director of Advalorem Value Asset Fund Limited.

    https://www.thesun.co.uk/archives/news/232492/la-la-land/

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  6. Another tasty morsel is that Minette was a director of the Gibraltar entity of Privilege Wealth….and we all know how that ended up.

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  7. https://www.prnewswire.com/news-releases/sadis–goldberg-investigating-alleged-global-fraud-and-ponzi-scheme-by-privilege-wealth-management-and-privilege-direct-300348740.html

    https://www.fsc.gi/news/mrs-minette-compson-decision-notice-and-decision-letter-221

    Oh…I have just read the story about Privilege wealth management limited too. Why would anyone give this woman money?

    Does anyone know anything about the other directors or their company in America the Greater Cannabis Company Inc.

    don’t know why im writing really, she’s not getting another penny of my money. how do we stop this from happening?

    Like

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