As Proper Group AG battles bankruptcy in the Swiss courts, sources have revealed that a long term advisor to the company, Peter Löhr, was previously convicted of embezzlement in a Swedish scandal.
Löhr - who has a very minimal online footprint - has been a constant presence throughout the company’s chequered history, serving as a “general advisor” to former CEO Mattias Hjlemstedt, and somehow surviving round after round of culls of senior executives that has seen the zombie company fall from a supposed $2.5 billion valuation and hundreds of employees to the ‘barely-there’ status of today, with only a skeleton team left in Switzerland.
Throughout the rise and fall of the company formerly known as Utopia Music, Löhr has somehow managed to remain in place as a trusted advisor to a string of executives who have tried to turn the business around, and continues to advise John Mitchell, a key investor in the business who was the board chair of Proper Group AG prior to bankruptcy proceedings being instituted against the company in the Swiss courts.
Sources have characterised Löhr as an “enforcer” tasked with doing dirty work as and when needed, including issuing legal threats to anyone critical of Utopia’s business, as well as being involved in processes around firing staff, negotiating settlements and strong-arming former employees into confidentiality agreements. It is also believed that Löhr was one of the executives who pulled together the bankruptcy appeal. Yesterday, John Mitchell told CMU that the appeal had involved “a 200 page document that a small group of executives worked tirelessly on for ten days”.
Löhr’s name has come up repeatedly in conversations with many sources associated with Utopia, with many former employees apparently aware of Löhr’s colourful past.
Over the last twelve months or so, coverage of Löhr’s previous conviction has gradually been erased from the internet - described by one source as “a clean-up job” - with only a couple of online media still publishing details of the charges that led to that conviction. However, CMU has been able to confirm details of Löhr’s past with numerous independent sources.
According to contemporaneous coverage in the Swedish press, Löhr was a “well known and talented lawyer” and member of the Swedish Bar Association, tasked with managing bankrupt companies on behalf of the state. After embezzling 3 million kroner from the bankrupt companies, Löhr apparently laundered the money through the bank accounts of associates, before using the proceeds to buy a villa.
When the fraud was discovered, Löhr was sentenced by a district court in Sweden to time in prison.
As the recent bankruptcy drama has unfolded, a number of sources have contacted CMU to point out that, with the company under incredible scrutiny by the Swiss authorities, creditors and investors, it seems remarkable that John Mitchell - a trusted financial services professional with significant experience and acumen, who runs Australia-based Mitchell Asset Management - would risk derailing Proper Group AG’s bankruptcy appeal with this sort of association.
With further details on the Swiss bankruptcy expected in coming days, it will be interesting to see what view the Swiss authorities take on Löhr’s involvement with Proper Group AG.