Intrade may yet live again. At least that is the hope offered by a statement from company director Ronald Bernstein. The site suspended all trading on March 10th, citing a shortfall of funds. An internal investigation revealed the company was missing $700,000 of customer funds, and announced the intention of liquidation if new investors were not found. They also requested clients with customer funds in Intrade to take 50% of their balance immediately, with the remainder hopefully to be paid off down the road.
Both conditions appear to have been met, according to this announcement on the Intrade website:
Since April 5, 2013, we have been working on the creation of a forbearance agreement with Members that, if accepted in a sufficient amount, would allow the Company to remain solvent; to immediately pay Members at least 50% of their settled account balances; and to prosecute various legal claims against parties we believe have harmed the Company.
At this time, we are very close to achieving the required acceptance. As such, it has been determined that the most responsible action is to extend the deadline previously established to allow time to complete discussions with some Members who have not yet conclusively resolved to accept the forbearance arrangement. It is our hope that their agreement now will help us achieve the required total amount.
Please note that even partial re-payments of member funds could not begin until it has been confirmed that sufficient funds in aggregate have been agreed to be waived.
In addition to these efforts, we have been engaged in serious discussions with at least one investment firm about investment into and/or partnership with Intrade. Any arrangement contemplated by a new transaction would only be considered by the Company if it preserved AT LEAST the benefits of the terms of the currently proposed forbearance arrangement. Our discussions also include the possibility of no forbearance by members, with some contingencies.
In the very near future, we hope to announce either 1/ the accomplishment of forbearance agreements in a sufficient amount to allow partial repayments of member funds, or 2/ the relevant terms of a proposed transaction involving the Company which would be of greater benefit to our Members than the forbearance plan.
In the meantime, we will continue to explore every avenue we can to preserve and improve the situation for members.
We will provide a further update here no later than April 30, 2013.