SpinVox Investigating Letter Sent To Investors

Voice-to-text firm SpinVox is trying to identify the authors of a letter sent to shareholders that alleges financial mismanagement.

paidContent:UK has not seen the letter, but, according to a source, SpinVox believes it was sent by former management some time ago to The Sunday Times, Financial Services Authority and most investors.

A source says it centres on parts of SpinVox’s 2008 accounts, which are yet to be filed, and makes allegations of accounting irregularities including whether deals have been recorded properly and whether funds were used for company expenses.

SpinVox, led by CEO Christina Domecq, tells yesterday’s Sunday Times: “The major shareholders and the board of directors are aware of the serious allegations that have been made against the company and they take very seriously any implications regarding the company’s management and operations. The major shareholders and the board are supportive of senior management who have built a transformational technology business.”

The company’s lawyers add: “Our clients have contacted those ex-employees it believes are responsible for the contents and distribution of the letter and we are advising our client on the legal options available to it.” Those suspected of sending the letter have received “own-up-or-else messages” from the company, according to a source.

The company has been without a full-time chief financial officer since Andrew Cherry left in June 2008, since when seven of Cherry’s nine staff have also left. A financial controller and head of financial planning and analysis have also been recruited and departed since January, we understand.

SpinVox raised $100 million after launching in 2003, and a further $100 million in March 2008 but, in the last month, we have received numerous complaints from current and former staff about the allocation of company funds, including grumbles about late or non-payment of staff salaries, expenses and payments to suppliers. Most staff have accepted equity instead of salary during July and August.

Domecq told us company finances are pressured by the credit crunch and heavy capital expenditure associated with Latin America roll-outs that will nevertheless shortly take SpinVox cashflow-positive. The company last week finalised emergency funds of over £15 million, as we revealed.

The company has not responded to our invitations for comment today.

The Financial Services Authority tells us it cannot confirm whether or not investigations are underway in to companies until such time as any sanction is brought against such a company.