One of the reasons online gaming operator Mansion Group had continuous financial trouble may not have been because of its fights in regulated markets, but because of former CEO Karel Mañasco’s ineffectiveness. Gibraltar plans on holding him to task, though, hitting him with a global asset freeze order worth £5 million (US$6 million).
An aerial view of Gibraltar. Mansion Group, the gaming operator based there, is fighting with its former CEO and has won a request to have his assets frozen. (Image: National Geographic)
Mansion began shutting down some of its online operations, such as its sports betting in the UK a year ago, six months after suspending Mañasco. He was allegedly using the company as his own piggy bank, making purchases and negotiating deals on the side with Mansion’s money.
In an effort to stop any additional financial leaks, Mansion then approached the courts in Gibraltar to request assistance. In an effort to try to balance its checkbook, Mansion has won a restraining order that will prevent Mañasco from moving assets until the case is resolved.
A Personal Piggy Bank
Media outlet GBC News in Gibraltar reports that a court judge has agreed to freeze Mañasco’s assets as Mansion figures out if there’s more damage. The “nuclear bomb” that prevents the embattled CEO from being able to manage the assets is necessary as Mansion looks for restitution from the man it charged with running the company.
In total, the gaming operator believes Mañasco may owe it at least $2.76 million, but can’t be sure. This is because he was, according to Mansion, happy to run around using company money for wild and frivolous purchases. Financial experts are still combing through the books to figure out exactly how much damage may have been done.
Because of Mansion’s structure at the time, Mañasco not only served as CEO, but as CFO, as well. This gave him carte blanche to use company funds with no one having to sign off on the purchases. That lack of infrastructure is now coming back to haunt the company.
The judge in Gibraltar overseeing the case, Chief Justice Anthony Dudley, agreed that freezing the assets in the best interest of justice at this time. He said Mañasco has “low standards of morality” and, while an asset freeze order should not be used rashly, it was justified in this case.
Mañasco indicated that he plans on fighting the order.
Fast Cars and Flashy Jewelry
In September 2021, Mansion began sensing that something was wrong. Purchases made for luxury cars – such as Mercedes and Range Rovers – and jewelry – including 15 luxury watches – with company money didn’t add up.
In addition, there were allegedly other questionable payments on company credit cards, unauthorized rent payments and even the purchase of a domain name with company money. The latter was a $17,000 expense, and the domain had nothing to do with Mansion.
Mañasco also used company money to deliver payments of over $2.65 million to a company in the Marshall Islands, White Wizard Media. However, according to Mansion’s records, White Wizard never did any work for it.
Mansion also continues to question him about the bonuses he authorized for himself, including $346K in 2019 and $513K the following year, despite nothing appearing in his contract about the extra payments. It also wants to know why Mañasco gave himself a personal allowance of $79K, which also was not in his contract.
In light of the perceived abuse of power, the company gave its former leading figurehead some paid time off and, in December 2021, he resigned. However, he has repeatedly claimed he is innocent of any wrongdoing.
Mañasco asserts that, as CEO, he had the right to make decisions that were, in his estimation, in the best interest of the company. This apparently includes allegedly purchasing a Ferrari to zoom around the 18 miles of roads in Gibraltar.
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