BUSINESS SCANDAL

Gowex founder writes open letter apologizing to staff for actions

Madrid administrations break off relations with free wi-fi firm in wake of fraud revelations

A woman walks past a newspaper kiosk joined to the Gowex wi-fi network in Madrid.
A woman walks past a newspaper kiosk joined to the Gowex wi-fi network in Madrid.ANDREA COMAS / REUTERS

Employees at free wi-fi firm Gowex, which is in the process of filing for bankruptcy after its founder and chief executive admitted to falsifying the company’s accounts, released a statement on Monday saying that they felt betrayed by their boss, Jenaro García, and are investigating whether they can sue him. According to their press release, they have been in “a state of complete shock” since the now ex-chief executive admitted to having been cooking the company books for at least four years.

The downfall of García and his company was brought about by a devastating report issued by the mysterious US analysis firm, Gotham City Research, which claimed that the turnover of the firm was 90 percent lower than stated in its results, that it was inflating its contracts, and that its main clients were firms created by Jenaro García, among other accusations.

The downfall of García was brought about by a devastating report issued by a mysterious US analysis firm

“Ever since the Gotham report was published, we have continued to work and trusted that the company would show us irrefutable proof that would disprove the arguments included in [the report] were false, as the chief executive of the company had told us,” the statement issued by the 172 employees read.

The staff have also posted a video on YouTube in which García is seen addressing the workforce of Gowex in the wake of the report, assuring them that the company was solvent. In the recording, he is heard joking about putting wi-fi in Gotham City, the fictional location of the Batman franchise from which the analysis firm takes its name.

García sent a letter to his former staff admitting that he has caused “irreparable damage” to the employees

On Tuesday morning, however, García sent a letter to his former staff admitting that he has caused “irreparable damage” to the employees, and to many of their friends and family. In the text, which has been posted online, García states that he is always working on projects, and that his new project is to “assume the consequences of his decisions and try to repair the damage that has been inflicted and do so with dignity.”

The letter ends with the poem “If” by British writer Rudyard Kipling.

The chief executive for North America at Gowex, Carlos Pujol, announced he would be resigning from his post

Meanwhile, the chief executive for North America at Gowex, Carlos Pujol, announced on Monday that he would be resigning from his post. The company had hired him in April to manage its ambitious expansion into a number of major US cities.

“Under these circumstances, I am taking the professional decision to renounce a role that I have held for the last two months, although I will be available to the company for any issue they may need me for,” Pujol said. The executive decided to resign as soon as he found out that the company had been falsifying its accounts, and said he would be dedicating his time to “other professional projects.”

The Madrid regional government and the city council – both run by the Popular Party – have already announced that they will be tearing up their contracts with Gowex, which had been hired to provide free wi-fi services on the Metro system, municipal buses and at train stations, as well as in a number of public squares.