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Official Receiver provides updates on PledgeMusic liquidation
By Chris Cooke | Published on Monday 5 August 2019
The short message that replaced the PledgeMusic website last month has been updated to reflect last week’s developments. Meanwhile, the UK’s Official Receiver has also issued a short statement about the Pledge company’s liquidation.
The crowdfunding and pre-order platform ceased operations back in February, of course, as mounting financial problems took the company to the brink. However, it was only late last month that the Pledge website was taken down, replaced by a short update to the effect that the firm was continuing “to work with outside counsel on the most appropriate next steps”.
Then last Wednesday, in the high court in London, an order was issued instructing the Official Receiver to begin liquidating the company. It transpired that the Pledge board had initiated that process in June. Although co-founder Benji Rogers – who no longer worked for the business but had been consulting on a voluntary basis since late January – said that efforts to find a buyer for the Pledge operation continued until early last week.
Following last week’s court order, the statement on the Pledge website was updated to read: “A winding up order was made against Pledgemusic.com Limited in the High Court Of Justice on 31 Jul 2019. As a result of the making of the order, the Official Receiver becomes liquidator of the company”. A contact email and reference number is then provided for anyone affected by the liquidation: [email protected] and LQD5671373.
The Official Receiver is a government official who is now charged with the task of selling off any assets Pledge still had. She will also need to put together a list of creditors, which includes all the artists who had been running campaigns on Pledge in the months before its collapse. Any monies raised by the asset sale are then shared out between those people.
US websites Music Technology Policy and The Trichordist both tweeted the Official Receiver. The former pointed out that artists in multiple countries have likely been affected by the collapse of Pledge, many of whom won’t be able to make physical representations in the UK. The latter asked whether affected artists should be approaching the Crown Prosecution Service as well as the Official Receiver demanding some kind of criminal investigation.
Confirming its process and powers, the Official Receiver tweeted back: “Following the winding up of PledgeMusic, the Official Receiver has been appointed as liquidator and will now determine the cause of its failure. If unacceptable conduct is identified she can seek to have the directors banned from running other companies for up to fifteen years”.
Trade group UK Music has already asked the government to consider suggesting to the Competition & Markets Authority and/or Financial Conduct Authority that they also investigate what went wrong at Pledge. That would include whether any laws were broken and also what lessons can be learned for other crowdfunding websites.
