Finnish inventor suspected of fraud
The Finnish inventor Rainer Partanen, 69, is today being charged at the Helsinki District Court with aggravated fraud and accounting offences in the period from 2001 to 2007.
Partanen, the Managing Director of Europositron, has collected a total of EUR 1.3 million with the help of a battery project based on innovative nanoscale electrochemistry technology that allows the production of rechargeable aluminum batteries.
Nearly 300 shareholders, who all have invested in Partanen’s issue of shares, have come forward as victims of the suspected scam.
According to the shareholder register, acquired by Helsingin Sanomat, Partanen managed to sell shares in Europositron in Finland, Sweden, and in the USA. Moreover, one shareholder has also been found in both Slovenia and France.
The largest number of foreign owners was found in Sweden, where a total of 70 investors believed in nanochemistry. In Sweden, Partanen advertised his share issues at least in the financial newspaper Dagens Industri.
Typically, shareholders invested in Europositron the minimum sum of EUR 1,500, but investments of as much as EUR 24,000 were also made.
According to the indictment, Europositron existed mainly for the purpose of selling its own shares, as the amount of money used for the development of the project and for the drafting and submitting of a patent application was only EUR 2,919.
The funds raised through the trading of shares were mostly used for Partanen’s personal livelihood and other actions - not for the research and development of his project, the indicment states.
According to Partanen, the total of EUR 1.3 million was used to finance the construction and development of a prototype based on Europositron’s new rechargeable battery technology, as well as to advertise the project.
In fact, Partanen sent the shareholders several letters, reporting the launch and progress of the prototype programme.
However, the police were unable to locate any kind of prototype for aluminium batteries. Moreover, the invention documents which were confiscated from the company’s safe, were incoherent, factitious, and defective, while the text was unscientific, the prosecutor charges.
The indictment indicates that the manufacturing of a rechargeable aluminium battery would not have been possible on the basis of the invention data found in the safe.
The prosecutor has issued a subpoena to several experts, who will testify that the expenses to construct a prototype of the described invention could have been around EUR 10,000 to 100,000. According to Partanen, the required amount of funds should be EUR 8 million.
The minority shareholders paid EUR 1,500 for one Europositron share, while Partanen himself bought his shares at EUR 0.50 per share, according to the indictment.
The police investigations also revealed that the investors who had subscribed Europositron’s shares were never invited to the company’s general meetings.
When the auditors repeatedly complained about Partanen’s incorrect operation at Europositron, Partanen became nervous and decided to file a liquidation petition in the summer of 2007.
The indictment notes further that the decision on the liquidation was also made by Partanen alone. He also decided that the assets of the company would be divided so that he would get 90 per cent while the share of the minority shareholders would be only 10 per cent of all assets, the pre-trial investigation records indicate.
However, Partanen did not manage to dissolve his company before the police apprehended him, after which the court remanded him in custody for more than a month in the autumn of 2007.
Partanen himself has denied all allegation, expressing his stand that ”the invention in question will work one day” and that ”the related theory is feasible”.
According to the defence, the plaintiffs have made a high-risk investment in the company in order to put it into operation while nobody has claimed that ”the invention is completed”.
Among the investors were many experts in the energy sector, including Bo Lindfors, the former President of Fortum Gas, who invested EUR 7,500 in Europositron in the spring of 2004, according to the shareholder register.
Lindfors is one of the witnesses subpoenaed by the prosecutor.
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