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Insolvency claim for miles possible, 0.33 eurocents per mile [edited]

Insolvency claim for miles possible, 0.33 eurocents per mile [edited]

Old Apr 14, 2018, 1:21 pm
  #31  
 
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I took the time to read the document attached to the e-mail message ("Topbonus Insolvenzplan 2018"). As a non native speaker of the German language it was quite a challenge ... but I struggled even more because of the peculiarities of German law, which seems to be very different from insolvency legislation in any other country (including Switzerland or the UK).

Anyhow, the first part of the report, about the history of Topbonus' insolvency, was easy and interesting to read. In my view the most interesting revelation is that the lack of liquidity was primarily caused by Etihad, which (partly) claimed back a loan in the amount of EUR 81m, thereof EUR 13.5m shortly before the insolvency of Topbonus Ltd. On the other hand side, AirBerlin seems to have paid everything but the very last EUR 4m it owed Topbonus. Many posters in this forum, including myself, thought that Topbonus' insolvency was caused by AirBerlin's insolvency, which clearly is not the case!

An owner (Etihad) extracting liquidity immediately before insolvency are in most countries committing a criminal offense. Such funds can usually be claimed back by insolvency administrators, on behalf of the creditors. The "Insolvenzplan" does briefly touch on this, but does not include such a claim, which I find very strange.

As I said at beginning of this post, the latter part of the Insolvenzplan is not comprehensible without in depth knowledge of German insolvency law. The Insolvenzplan mentions various estimated quotas, but I would not like to spread wrong information caused by misunderstandings.
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Old Apr 14, 2018, 3:21 pm
  #32  
 
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Originally Posted by swiss_global
I took the time to read the document attached to the e-mail message ("Topbonus Insolvenzplan 2018"). As a non native speaker of the German language it was quite a challenge ... but I struggled even more because of the peculiarities of German law, which seems to be very different from insolvency legislation in any other country (including Switzerland or the UK).

Anyhow, the first part of the report, about the history of Topbonus' insolvency, was easy and interesting to read. In my view the most interesting revelation is that the lack of liquidity was primarily caused by Etihad, which (partly) claimed back a loan in the amount of EUR 81m, thereof EUR 13.5m shortly before the insolvency of Topbonus Ltd. On the other hand side, AirBerlin seems to have paid everything but the very last EUR 4m it owed Topbonus. Many posters in this forum, including myself, thought that Topbonus' insolvency was caused by AirBerlin's insolvency, which clearly is not the case!

An owner (Etihad) extracting liquidity immediately before insolvency are in most countries committing a criminal offense. Such funds can usually be claimed back by insolvency administrators, on behalf of the creditors. The "Insolvenzplan" does briefly touch on this, but does not include such a claim, which I find very strange.

As I said at beginning of this post, the latter part of the Insolvenzplan is not comprehensible without in depth knowledge of German insolvency law. The Insolvenzplan mentions various estimated quotas, but I would not like to spread wrong information caused by misunderstandings.
It is challenging read what it is important is that the administrator has found a potential investor... still I do totally agree with you that Etihad is liable for 75% of all the debt of Top bonus but it is only responsible for no more than 280.00 Euros!
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Old Apr 15, 2018, 5:04 am
  #33  
 
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Originally Posted by RolfD
It is challenging read what it is important is that the administrator has found a potential investor... still I do totally agree with you that Etihad is liable for 75% of all the debt of Top bonus but it is only responsible for no more than 280.00 Euros!
RolfD, according to you signature you live in Germany. I wonder if owners are extracting money from a company that subsequently becomes insolvent, is really permitted in Germany? In most countries, including all anglo-saxon countries but e.g. also Switzerland, this is a serious offense which leads to both criminal prosecution and a civil obligation to return the money extracted, for the benefit of the creditors. I'm really surprised that everyone in Germany (including the administrator) seems very lenient on this ...
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Old Apr 15, 2018, 7:45 am
  #34  
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I also got the "Insolvenzplan" and found the reading VERY interesting. The business model is described very openly and shows IMO that the miles programs are operating on a very thin line between ordinary/honest business and total scam (regarding the mileage asset of their customers).

The projected quota for the first round of payouts is less than one percent. So if you submitted a claim of 100 Euros you'll get paid less than a Euro in a few weeks time. In two follow up rounds during several months to come the projected final payout is about 7.5 percent of your claim in total.

A Cyprus based company (resulting in no information if you google it) invests 2 M Euros which will be the main source for the payouts. It is stated that a new loaylity programm should be started based on the more than 2 M active members of topbonus. They intend to offer status members some kind of new currency for their lost miles to keep them as the most interesting members active.

Insolvency was based on two factors: the suddenly missing possibility to issue award tix on AB / through AB on oneworld carriers. And the drain of liquidity from Etihad - they supported topbonus with 200 M Euros which were fully transferred to AB (I didn't understand the financial mechanisms behind that transfer) but charged topbonus for amortization which was paid in the amount of 81 M, 13.5M of it shortly before insolvency. This is a very questionable process and EY (and topbonus management) might be liable at least for those last 13.5 M. This was made transparent in the papers but to my absolute surprise did not result in a financial position in calculating the projected quota. The possible claim against EY is instead left open - it seems it's intended to sell it for a small one time payment (I didn't fully understand this mechanism, too) - I'm not sure if this claim against EY might be the potential big business for the investor or some third party not fully visible at that time.

The modus operandi of topbonus, the role of EY with the onesided drain of liquidity and the very low insolvency pay out quota leaves a lot questions open. IMO the whole thing is anything but a honest business.
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Old Apr 15, 2018, 7:46 am
  #35  
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Your words are exactly what my thoughts have been. There’s no way I could have expressed it as well as you because I know very little about such matters. But I have a feeling there will be a few revelations to come about this whole business.
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Old Apr 15, 2018, 5:04 pm
  #36  
 
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Originally Posted by swiss_global
RolfD, according to you signature you live in Germany. I wonder if owners are extracting money from a company that subsequently becomes insolvent, is really permitted in Germany? In most countries, including all anglo-saxon countries but e.g. also Switzerland, this is a serious offense which leads to both criminal prosecution and a civil obligation to return the money extracted, for the benefit of the creditors. I'm really surprised that everyone in Germany (including the administrator) seems very lenient on this ...
That is the Million Euro question. as far as i know that is not allowed in any country furthermore the Airberlin's investor are suiting Etihad for 1 Billion Euros because the failed to fulfill the agreement to fund airberlin until 2018.
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Old Apr 15, 2018, 5:12 pm
  #37  
 
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Originally Posted by ralfkrippner
I also got the "Insolvenzplan" and found the reading VERY interesting. The business model is described very openly and shows IMO that the miles programs are operating on a very thin line between ordinary/honest business and total scam (regarding the mileage asset of their customers).

The projected quota for the first round of payouts is less than one percent. So if you submitted a claim of 100 Euros you'll get paid less than a Euro in a few weeks time. In two follow up rounds during several months to come the projected final payout is about 7.5 percent of your claim in total.

A Cyprus based company (resulting in no information if you google it) invests 2 M Euros which will be the main source for the payouts. It is stated that a new loaylity programm should be started based on the more than 2 M active members of topbonus. They intend to offer status members some kind of new currency for their lost miles to keep them as the most interesting members active.

Insolvency was based on two factors: the suddenly missing possibility to issue award tix on AB / through AB on oneworld carriers. And the drain of liquidity from Etihad - they supported topbonus with 200 M Euros which were fully transferred to AB (I didn't understand the financial mechanisms behind that transfer) but charged topbonus for amortization which was paid in the amount of 81 M, 13.5M of it shortly before insolvency. This is a very questionable process and EY (and topbonus management) might be liable at least for those last 13.5 M. This was made transparent in the papers but to my absolute surprise did not result in a financial position in calculating the projected quota. The possible claim against EY is instead left open - it seems it's intended to sell it for a small one time payment (I didn't fully understand this mechanism, too) - I'm not sure if this claim against EY might be the potential big business for the investor or some third party not fully visible at that time.

The modus operandi of topbonus, the role of EY with the onesided drain of liquidity and the very low insolvency pay out quota leaves a lot questions open. IMO the whole thing is anything but a honest business.
let's wait and see what the Federal government, the list of creditors including ourselves has to say. and let's not forget the decision of the district court in Berlin. Also Etihad is been suit by the creditors or the investor of Airberlin from Breach of the agreement made by Etihad to keep funding Airberlin until 2018 ( the lawsuit is about 1 billion Euro)
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Old Apr 18, 2018, 2:50 am
  #38  
 
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I suppose it's fully possible that the new investors recognize that they could have a claim against Etihad, but don't expect they can extract the money quickly or easily, so they try to make a business plan work without this injection.
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Old Apr 20, 2018, 8:08 am
  #39  
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looks dodgy

I have been getting emails telling me to make a claim. It has my name and Topbonus number etc.

However when I went to fill in the claim form I have to provide my bank details.

Looks very dodgy to me.

cheer Peter
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Old Apr 20, 2018, 2:55 pm
  #40  
 
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Originally Posted by ffhound
I have been getting emails telling me to make a claim. It has my name and Topbonus number etc.

However when I went to fill in the claim form I have to provide my bank details.

Looks very dodgy to me.

cheer Peter
I'm can tell if the email you received is dodgy or not, but the Topbonus website has a link to the site where you can make a claim for the miles in your account. To pay you out, they obviously need your bank account.

PS: Never use the links in an email.
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Old Apr 20, 2018, 3:34 pm
  #41  
 
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Originally Posted by ffhound
I have been getting emails telling me to make a claim. It has my name and Topbonus number etc.

However when I went to fill in the claim form I have to provide my bank details.

Looks very dodgy to me.

cheer Peter
Peter

the web site said that you can fill the bank information after the process is concluded. but remember you only have 4 days to complete the claim
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Old Apr 21, 2018, 10:45 am
  #42  
 
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I just wanted to say a word of thanks to everyone who has been posting such useful information here. I have had no communication from the liquidator so all of the information I have has come from here.
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Old Apr 21, 2018, 10:22 pm
  #43  
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Originally Posted by RolfD
Peter

the web site said that you can fill the bank information after the process is concluded. but remember you only have 4 days to complete the claim
Thanks

But as I only have 1,000 miles it is not really worth the effort.

cheers Peter
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Old Apr 24, 2018, 11:47 am
  #44  
 
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Even though I selected United States as the address country, it changes to United Kingdom on the confirmation page, and I note there's no choice for UK in the drop down.
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Old Apr 24, 2018, 2:20 pm
  #45  
 
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Prior to all this, my spouse and I had used up our miles. we both had just under 500 combined total on our accounts. I still filled out the forms for the 2 of us anyway, I think it will be just under 2EUR total.

Last edited by arollins; Apr 24, 2018 at 2:36 pm
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