Meet the “Secret Millionaire” whose company owes investors thousands

A company belonging Jim Breen, the one-time star of RTE’s “Secret Millionaire” programme, owes small investors tens of thousands of euros, and has failed to discharge the debts for eight years, and is facing legal action from some investors who believe themselves to have been duped, Gript can reveal.

Pulse Learning, a company which provides in-house training, it says, “to companies around the globe”, sought to raise funds from so-called “BES investments” all the way back in 2008. BES stands for “business expansion scheme”, and it was designed to encourage small investors to put their money into Irish businesses, in order to help them grow. In return, the investors would make a fixed profit on their investment, which would be repaid inside five years. Investors were also entitled to tax relief on the funds invested.

In 2008, Pulse Learning was seeking to expand, and sought investments of tens of thousands of euros from small to medium Irish investors. One investor, for example, invested €30,000 worth of their savings, at an interest rate of 17% over five years. Under the terms of the agreement, about €50,000 is now owed to that investor. Other investors invested similar amounts, and although the total amount of money placed with the firm cannot be determined in full, Gript understands it is in the hundreds of thousands of euros.

None of the investors we spoke to have been repaid, almost eight years after their investments matured.

Last week, Mr. Breen sent an email to the jilted investors, saying that they had yet to be repaid because unnamed “Preference Shareholders” were also owed money, and that these debts – which were, themselves, three years overdue, took precedent over the BES investors under the company constitution.

In an email to the thwarted creditors, seen by Gript.ie, Mr. Breen wrote:

“Our audited PulseLearning Ltd Accounts for 2017 have been submitted to the CRO.  2017 was a difficult year with a loss after taxation of €336,719. This has resulted in overall negative net assets in PulseLearning Limited of €232,406 at 31st December 2017. 

As communicated in previous years, the constraint in redeeming your investment is that the Preference Shareholders have a repayment preference under the Company Constitution.  They are still not prepared to alter their preferred status. These Preference Shareholders invested €523,780 and are entitled, in addition to the initial investment, dividends of €442,136 through 31st December 2017.

The Company therefore will not for some time have distributable reserves sufficient to enable repayment of firstly the CRCP shareholders and thereafter the BES Investors.  The Company is intent on redeeming both sets of shares.”

While it would not be unusual for a company’s constitution to prioritise certain shareholders over others, it would be unusual for such an arrangement to legally supercede binding contracts made with the smaller investors. Requests for comment on these questions also went unanswered by Pulse Learning.

Gript understands that one of the largest of these so-called “preference shareholders” is Enterprise Ireland, a state body. In that case, it would appear that a state agency is actively blocking the repayment of small Irish shareholders. Gript has sought comment from Enterprise Ireland, but no such comment was received at the time of publication.

Mr. Breen came to public prominence in 2013, when he starred as one of RTE’s “Secret Millionaires”. In 2007, the Irish Times reported that Pulse Learning was worth €30million:

“With an initial investment of €10, it has grown to a current estimated worth of € 30 million and has achieved a turnover growth of 6,000 per cent since inception. The company is looking to double growth this year for the sixth year in succession. PulseLearning now employs 85 people and has offices in New York, Canada, Tralee and Limerick.”

The company presently lists some major clients, including the Government of New South Wales, in Australia, Allianz Insurance, British Petroleum, and the American Chamber of Commerce in Ireland, which represents many of the large American multinationals based here.

It also gains significant business from the Irish Government, counting Government agencies like Fáilte Ireland and Enterprise Ireland amongst the ranks of its clientele.

Gript requested comment from the company as to why small investors, many of whom had invested savings with the company, had gone unpaid for so long. No comment was received.

Speaking to Gript, one of the investors said that she felt that the company was “putting its head in the sand and hoping the problem would go away”. She said that she felt the company’s responses amounted to “gobbledegook”, and complained of a “total lack of transparency”.

“We’re not allowed to see the accounts”, she said. “Nor are we given any information, except via an occasional email pleading the poor mouth”.

“But Pulse Learning has all these major clients – many of them Government agencies, and a small enough staff. It’s just not credible that the company cannot afford to repay small investors who lent it fairly small sums of money over a decade ago. A loss in one year is one thing, but this company has had over a decade to repay us, and it has consistently failed to do so”.

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