Payment postponed

At the beginning of April, the Polish Securities and Exchange Commission (KPWiG) rescinded WGI Dom Maklerski's (WGI DM) brokerage license after it was found not to be abiding by the rules of fair sales. The brokerage house was also asked to return its clients' deposits by the end of May. WIG DM is currently in the process of liquidation, but its clients will probably not see any money from their investments until mid-2007.

Last week the co-founders and co-owners of the WGI Group announced that although clients will receive bonds from WGI Consulting, which made up most of their investment portfolios, these bonds won't be able to be liquidated soon. "Repayment of funds after liquidation of the bonds will be postponed," said the president of WGI Consulting Maciej Soporek, adding that the payments could take place in May 2007. "We want to protect our clients. ... If we started paying back the money now, our clients would face losses of 30-40 percent," Soporek added.

WGI Consulting's vice-president Łukasz Kaczor said that the company is looking for solutions with other financial institutions so the funds could be repaid earlier. He added that the money will be returned with interest "higher than those on bank deposits."

Although the bonds won't be changed into money for another year, investors will receive 10 percent of their investment now. This is money which was invested on the currency market and which was paid by investors as security.

Both owners announced that returning the money is the company's absolute priority. "Our future on the market depends on whether we pay the money back," Kaczor said. He also admitted that entering the brokerage market was not a wise decision. "The activities of our brokerage house was a total misunderstanding," he said.