Mintos ‘disappointed’ as Wowwo court case drags on
Mintos has expressed disappointment after a judge ruled that its legal battle with Wowwo would be reviewed in a general court.
Wowwo is a Turkey-based car loan company which listed its loans to Mintos investors. In February 2022, Wowwo’s loans were suspended from the Mintos platform following a currency risk which materialised after the Turkish lira saw a major decrease in value against the euro.
Shortly soon after, Wowwo disconnected its API communication with Mintos and stopped making repayments to investors while negotiating proposals to deal with the currency losses. During this time, Wowwo proposed transferring borrower repayments in Turkish lira at the contemporary exchange rate, which would have resulted in losses for investors in Wowwo loans on Mintos.
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In July 2022, Mintos filed a claim against Wowwo in Latvia’s court of arbitration to recover money still owed to investors.
“We chose the arbitration court for two main reasons: First, proceedings are typically much faster compared to general courts; and second, it’s easier to recognize and enforce an arbitral award in Turkey, as both Latvia and Turkey are parties to the New York Arbitration Convention,” explained Mintos.
“Hence, a positive outcome in the arbitration court would have offered the fastest resolution in favour of investors.”
However, the judge decided that the case should be reviewed in a general court, which will cause further delays for investors hoping to recoup their capital investments.
Mintos said that while it respects the view of the court, it is “disappointed” by the outcome.
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“Wowwo’s line of arguments, together with other procedural tactics used by Wowwo to protract the case over several hearings that were several weeks apart, lead us to believe that Wowwo’s strategy was to drag out the proceedings as much as possible and to push back the court’s decision,” added Mintos.
“In our view, Wowwo’s strategy to argue how to pay as little as possible to investors on the grounds of arguments that appear opportunistic is questionable. As we understood, Wowwo even tried to claim that there was no evidence that it had received any funds from investors on Mintos.”
Mintos further claimed that Wowwo proposed paying investors the equivalent of 25 per cent of the money owed.
“The debt of Wowwo towards the investors remains outstanding,” added Mintos. “We’re now reviewing the details of the decision and assessing available options in state courts. We’ll update you once we have new information.”
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